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Gold down on stronger U.S. GDP data, dollar

Xinhua, December 23, 2016 Adjust font size:

Gold futures on the COMEX division of the New York Mercantile Exchange fell on Thursday on stronger U.S. gross domestic product (GDP) data and a stronger U.S. dollar.

The most active gold contract for February delivery fell 2.5 U.S. dollars, or 0.22 percent, to settle at 1,130.70 dollars per ounce.

A better-than-expected U.S. GDP report released by the U.S. Department of Commerce was released on Thursday, showing real GDP growing by 3.5 percent during the third quarter of 2016.

Analysts note that this was above the expectations, with agricultural exports above normal. This report put pressure on the precious metal as investors took this as a positive long-term sign for U.S. economic growth.

Gold was put under further pressure as the U.S. Dollar Index rose by 0.11 percent to 103.11 as of 1830 GMT. The index is a measure of the dollar against a basket of major currencies. Gold and the dollar typically move in opposite directions, which means if the dollar goes up, gold futures will fall as gold, measured by the dollar, becomes more expensive for investors.

The precious metal was prevented from falling further as the U.S. Department of Labor released its weekly jobless report on Thursday showing worse-than-expected jobless claims. Initial claims increased by 21,000 to 275,000 during the week of December 17th. Analysts note that the figures in this report were largely unexpected by the market, as U.S. employment data.

A report released on Thursday by the U.S. Department of Commerce showed durable goods orders within expectations, falling by 4.6 percent during the month of November. Analysts note extensive strength in defense aircraft and communications equipment, which boosted the headline figure. The precious metal likely was put under a slight amount of pressure from this report.

Silver for March delivery fell 10.8 cents, or 0.68 percent, to close at 15.871 dollars per ounce. Platinum for January delivery dropped 7 dollars, or 0.77 percent, to close at 907.40 dollars per ounce. Enditem