By Carla Mozee, MarketWatch LOS ANGELES (MarketWatch) — Gold futures stepped lower in electronic trade Thursday, and a fall in copper prices kept them pinned at 18-month lows. Gold for June delivery GCM3 +0.65% fell $6.4, or 0.5%, to $1,375.80 an ounce during the Asian trading hours. They finished Wednesday down $4.70, or 0.3%, at $1,382.70 an ounce on the Comex division of the New York Mercantile Exchange, hurt as the U.S. dollar rallied on safe-haven bids. Strength in the greenback tends to pressure prices for gold, as it makes the metal more expensive for foreign investors to buy, and Crédit Agricole on Thursday said it expects more downside for gold in the medium term on firming in the dollar. At the start of the year, Crédit Agricole said it was “among the most bearish forecasters for gold but even our forecast for $1,650 looks tough to achieve now,� wrote global head of strategy Mitul Kotecha to clients. Its new 2013 average forecast for gold is $1,480 an ounce and its end-year 2013 forecast is $1,350 an ounce. Concerns about selling of gold reserves by central banks in Europe, outflows from gold exchange-traded products, cuts in price forecasts and capitulation selling have all been cited by analysts as reasons investors have yanked gold prices sharply lower. Prices have lost more than 14% in April alone. Crédit Agricole’s Kotecha said its quantitative model on gold prices using oil prices, 2-year US Treasury yields 2_YEAR +2.61% and the U.S. dollar index DXY -0.08% “as explanatory variables highlights that the current sell off is overdone.� Shutterstock Enlarge Image Still, the model projects a decline in gold prices over the coming months based on Crédit Agricole’s forecasts for lower oil prices, higher U.S. yields and a gain in the dollar index, he wrote. Meanwhile, May copper futures HGK3 -1.08% on Thursday fell 10 cents, or 2.9%, to $3.10 a pound, trading at levels last seen in early October 2011. The industrial metal on Wednesday sank 3.6%, with a ramp up in demand concerns after China, a major commodities consumer, posted weaker-than-expected growth for the first quarter. Silver prices SIK3 +0.85% were also down, falling 17 cents, or 0.7%, to $23.13 an ounce, stretching Wednesday’s loss of 1.4%. July platinum futures PLN3 +0.15% lost $15.40, or 1.1%, to $1,418.60 an ounce. Palladium for June delivery PAM3 +1.78% slumped $1, or 0.2%, at $660.40 an ounce. Carla Mozee is a reporter for MarketWatch, based in Los Angeles. Follow her on Twitter @MWMozee.

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