Precious metals lose more shine

Gold settles at its lowest closing since end of December

Bullion metals ended lower on Thursday, 18 September 2014 at Comex. The price of gold on Thursday settled at its lowest closing since end of December, leading a broad decline in the metals group after the Federal Reserve indicated that it was not inclined to move quickly to raise interest rates. The dollar continued to strengthen across the board on Thursday.

Gold for December delivery slid $9, or 0.7%, to $1,226.90 an ounce, its lowest close since it settled at $1,205.70 on 31 December 2013.

December silver lost 1.1% to $18.45 an ounce.

Gold futures stabilized as Thursday's session wore on due to profit-taking and short covering, bouncing from the lowest level since early January after overnight selling in the wake of a U.S. Federal Open Market Committee meeting. Some physical demand also emerged on the price pullback that began late Wednesday.

Before the comeback, gold fell after Fed commentary was construed to mean rate hikes in the U.S. just might occur faster in 2015 than the market previously thought, underpinning the U.S. dollar. That hurt gold even though policy-makers otherwise said they would maintain low rates for a considerable time yet.

A day earlier, gold ended its modest winning streak, bogged down by concerns of a stronger dollar along with a bearish forecast from Barclays.

Among economic data expected at Wall Street on Thursday, the latest Initial Claims report revealed a drop to 280,000 from 316,000, while the consensus expected a more modest decline to 305,000. The reading marked its lowest level since July and aptly supports the view that the weak payroll growth seen in August is likely to be revised higher.

Housing Starts fell to a seasonally adjusted annualized rate of 956,000 units in August from a revised 1.117 million units in July, while the consensus expected a decrease to 1.045 million units. Building permits fell to a seasonally adjusted annualized rate of 998,000 versus a revised 1.057 million for July, while the consensus expected permits to come in at 1.054 million.

Separately, the Philadelphia Fed Survey for September fell to 22.5 from 28.0, while market had expected that the Survey would slip to 23.5.

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