IV:Gold prices edge lower with, U.S. data, Fed stimulus outlook in focus
Investing.com - Gold prices inched lower on Monday, as investors looked ahead to key U.S. economic data later in the week to further gauge the strength of the economy and the need for stimulus.
On the Comex division of the New York Mercantile Exchange, gold futures for February delivery traded at USD1,242.40 a troy ounce during European morning trade, down 0.65%.
Comex gold prices held in a tight range between USD1,241.90 a troy ounce and USD1,250.20 a troy ounce.
The February contract settled 1.01% higher on Friday to end at USD1,250.40 a troy ounce.
Gold futures were likely to find support at USD1,235.50 a troy ounce, the low from November 27 and resistance at USD1,254.50, the high from November 29.
Bearish sentiment on the precious metal remained intact after minutes of the Fed’s October meeting said the central bank could start scaling back its USD85 billion-a-month asset purchase program in the “coming months” if the economy continues to improve as expected.
The Institute of Supply Management was to release its manufacturing PMI later in the day. Investors are also focusing on Thursday’s third quarter gross domestic product report as well as Friday’s November nonfarm payrolls report.
The Fed, which holds its next meeting on December 17-18, has said the timing of its tapering depends on the health of the labor and housing markets.
Prices of the precious metal lost 5.4% in November, the biggest monthly decline since June, as solid U.S. economic data underlined expectations the Fed will begin curbing stimulus.
Gold is down approximately 26% this year, heading for the first annual loss in 13 years.
Elsewhere on the Comex, silver for March delivery fell 1.35% to trade at USD19.76 a troy ounce, while copper for March delivery inched down 0.15% to trade at USD3.201 a pound.
China’s final HSBC Purchasing Managers Index released earlier in the day inched up to 50.8 in November from a preliminary reading of 50.4, above expectations for 50.5.
The upbeat data was published one day after a government report showed that China’s manufacturing purchasing managers' index held steady at an 18-month high of 51.4 in November, compared to forecasts for a decline to 51.1.
Copper traders often use manufacturing numbers as indicators for future copper demand growth, as the industrial metal is widely used by the sector.
China is the world’s largest copper consumer, accounting for almost 40% of world consumption last year.
