By Claudia Assis, MarketWatch
SAN FRANCISCO (MarketWatch) — Mild losses accelerated to a broad selloff for gold and other metals Wednesday after a round of data painted a brighter picture of the economy and investors steered clear of metals ahead of an expected announcement from the U.S. Federal Reserve.
Gold for December delivery (GCZ10 1,336, -20.70, -1.53%) tumbled $23, or 1.7%, to $1,334.40 an ounce on the Comex division of the New York Mercantile Exchange.
Silver came off the previous day’s 30-year high to fall 2.4%, with the December contract (SIZ10 2,425, -58.60, -2.36%) losing 59 cents to $24.23 an ounce.
The dollar firmed, adding to the pressure on gold.
Traders contended with a report that the U.S. service sector grew more than expected. Factory orders also surpassed expectations. Read more on ISM report.
Later in the session, Fed officials are widely expected to announce a second round of bond purchases to help support the economy.
Although estimates on the size of the package vary, the “injection of liquidity should in any case increase the risks of inflation, which could prompt investors to increase investments in gold,” analysts at Commerzbank said in a report Wednesday.
The dollar came off earlier lows Wednesday, pressuring commodities. The dollar index (DXY 76.89, +0.17, +0.22%) , which compares the U.S. unit to a basket of six other currencies, was recently up 0.2% to 76.88.
Earlier Wednesday, a report from payroll giant Automatic Data Processing showed a healthy rise in private-sector jobs in October. Read more on ADP report.
