NEW YORK--Gold prices breached below the psychologically important $1,300 level Thursday after a better-than-expected U.S. economic growth reading.
The most actively traded contract, for December delivery, was recently down $13.90, or 1.1%, at $1,303.90 a troy ounce on the Comex division of the New York Mercantile Exchange. The contract traded as low as $1,296 an ounce.
The U.S. economy expanded at an annual rate of 2.8% in the third quarter, the Commerce Department said Thursday. The reading beat economist forecasts, which called for the July-to-September period to clock in at 2%, according to a Dow Jones Survey.
Gold traders closely follow U.S. economic data for clues about future monetary policy. The Federal Reserve's monetary stimulus measures had prompted some investors to buy gold as a hedge against inflation, a risk associated with the Fed's unconventional policies.
Now, as the economy appears to be on a firmer footing, some traders worry the Fed will move to curtail its bond purchasing program, removing a pillar of support from the gold market.
Write to Tatyana Shumsky at tatyana.shumsky@wsj.com
