WASHINGTON (Alliance News) - Gold was extending losses Friday morning amid increased speculation that the US Federal Reserve would start trimming its monetary stimulus in the next few months.
Gold for December delivery, the most actively traded contract, slipped USD2.30 to USD1,241.30 an ounce. Yesterday, gold extended losses to settle near four-month low mostly on some upbeat economic data out of the US, and as the Federal Reserve policy review Wednesday hinted at a possible taper to its quantity easing program sooner than later. In some positive economic news from the US, first-time claims for unemployment benefits fell more than expected in the week ended November 16, with claims falling to their lowest level in over a month, a Labor Department report showed Thursday. Meanwhile, producer prices in the US decreased modestly in October due largely to a steep decline in energy prices, the Labor Department said.
Holdings of SPDR Gold Trust, the world's largest gold-backed exchange-traded fund, edged down to 856.71 tons from 860.31 tons.
This morning, the US dollar was leveling off from its 2-week high versus the euro and trading firm against sterling. The buck was extending its four-month high versus the yen and trading lower against the Swiss franc.
In economic news from the euro zone, German business confidence improved more than expected in November, survey results from the Ifo Institute revealed. The headline business climate index rose to 109.3 in November from 107.4 in October. Economists had forecast an increase to 107.7. The current conditions index scored 112.2 during the month, up from 111.3 in October. The expected score was 111.5. The expectations index jumped to 106.3 from 103.7 in the previous month. This was forecast to rise to 104.
Meanwhile, German economic growth moderated in the third quarter as estimated in the preliminary report, final data from the Federal Statistical Office revealed. The seasonally and calendar-adjusted gross domestic product increased 0.3 percent quarter-on-quarter in the third quarter, matching the preliminary estimate published earlier this month. This was much weaker than a 0.7 percent growth recorded in the second quarter.
Elsewhere, the prices of silver and platinum were trading flat in morning deals.
