News Column

Gold Ticks Lower As Dollar Strengthens

August 29, 2014

WASHINGTON (Alliance News) - Gold futures were trading lower Friday morning, with the dollar trending higher on some upbeat economic data from the US with consumer sentiment improving unexpectedly even as the pace of consumer spending slackened.

Nonetheless, investor concerns over the ongoing conflict between Russia and Ukraine remained with Ukraine indicating that it would push for membership with NATO after claims of Russian troops on Ukraine soil.

Gold futures for December delivery are down USD2.10 or 0.2% at USD1288.30 an ounce.

On Thursday, gold futures gained USD7.00 or 0.5% to close at USD1,290.40 an ounce on its safe haven appeal as investors kept away from the riskier equity assets.

Most American stocks were trending higher, even as European stocks were heading toward close on a positive note, with most major averages holding up modestly higher. The major Asian markets closed mixed, on the negative close on Wall Street overnight and a slew of economic data from Japan.

Reflecting an upward revision from a preliminary reading, a Thomson Reuters and the University of Michigan report on Friday showed that consumer sentiment to have unexpectedly improved in August, with the final reading rising to 82.5 from a final July level of 81.8. Economists expected the final sentiment index for August at 80.2.

Meanwhile, manufacturing activity in the Chicago-area rebounded in August, as factories reported increases in new orders. The headline index of the Chicago Purchasing Managers report, an important gauge of manufacturing in the Midwest, jumped to 64.3 in August from July's 52.6, exceeding the consensus estimates for a smaller rise of 56.0.

Consumers spent less in July than in the previous month, a surprise retreat that complicates the prevailing belief that the US economic situation is improving. Data from the US Commerce Department also showed incomes rose at a slower pace in July than in the previous month.

Meanwhile, data on prices indicated that inflation pressures remain tame.

Silver for December is currently down USD0.039 or 0.2% at USD19.660 an ounce, while copper is up USD0.017 or 0.6% at USD3.1675 per pound.

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Source: Alliance News

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