Dull day for bullions

Gold ends five day winning streak

Gold futures settled lower on Monday, 17 March 2014. Gold prices ended lower putting an end to a five-session streak of gains as a rally in U.S. equities drew investors away from the precious metal. Economic sanctions by the U.S. and European Union aimed at a small group of Russian and Ukrainian officials were seen as minimal, also dulling the need for the perceived safety of gold.

Gold for April delivery fell $6.10, or 0.4%, to settle at $1,372.90 an ounce on the Comex division of the New York Mercantile Exchange, giving back most of Friday's 0.5% gain.

May silver closed down 14 cents, or 0.6%, to $21.275 an ounce.

All of the fear and loathing last week about the Sunday referendum in Crimea was set aside today. Stock markets in Europe and the US rallied, not because there was a de-escalation of the standoff in Ukraine, but because there has yet to be an escalation of the standoff that would threaten global economic growth. As expected, Crimeans voted overwhelmingly in favor (95.5% of votes cast) of joining the Russian Federation.

In other news Monday, the European Union's inflation rate in February was up 0.3% in February from January, and up 0.7% year-on-year. The figures were below market expectations and raise the specter of further monetary policy stimulus from the European Central Bank, as the rate of EU inflation is well below the ECB's target of 2.0% per year.

The Chinese government did move over the weekend to expand the Chinese yuan currency's trading band against the U.S. dollar, and the currency weakened against the dollar on Monday. That could also be an underlying negative for any commodity priced in U.S. dollars on the world markets.

Focus of the market place is turning to this week's meeting of the U.S. Federal Reserve's Open Market Committee (FOMC), taking place on Tuesday and Wednesday. Fed Chair Janet Yellen will deliver her first press conference after the FOMC meeting's conclusion Wednesday afternoon. It is expected the FOMC will continue on its tapering program, whereby monthly bond purchases are whittled down by $10 billion a month.

U.S. economic data released Monday included the Empire State manufacturing survey, Treasury international capital data, industrial production and capacity utilization, and the NAHB housing market index. None of the data had a major impact on the markets. Industrial production increased 0.6% in February, bolstered by a 0.8% jump in manufacturing production. The February strength came on the heels of a 0.2% decline in industrial production in January.

Separately, the Empire Manufacturing Index for March was slightly better than expected with a 5.6 reading (consensus 5.4). A number above zero denotes expansion. The NAHB Housing Market index, however, still reflected declining builder confidence with a reading of 47 for March. That was up from 46 in February but below the consensus estimate that called for a jump to 50.0, which is the dividing line between rising and declining confidence.

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