Gold Futures Near 34-month Low on Fed Speculations

By HY Markets Forex Blog

Gold futures were seen trading near its lowest level in 34 months on Tuesday as investors continue to speculate over the tapering of the Federal Reserve (Fed) stimulus program.

The yellow metal futures for February delivery declined 0.04% lower, standing at $1,221.40. Gold futures have been trading below $1,300 an ounce for over three weeks. While silver futures dropped 0.24% lower, standing at $19.255 an ounce at the time of writing.

Holdings in the world’s largest gold-backed exchange-traded fund, SPDR Gold Trust, came in at 843.21 tones on Friday.

The US dollar index, which measures the strength of the US dollar against a basket of six major currencies, remained unchanged at 80.926 points.

Gold Futures – US Data

The US manufacturing sector showed an improvement, advancing to a 33-month high of 57.3, up from 56.4 seen in October, according to reports from the Institute for Supply Management (ISM). The construction spending for October exceeded analysts’ expectations of 0.4%, rising to 0.8%. In September, construction spending dropped by 0.3% on a monthly basis.

US retail sales came in at $57.4 billion over the weekend, lower than last year’s figures of $59.1 billion with average shopper spending $407.02. Market participants are looking forward to the release of a string of key US data’s, including the third quarter gross domestic product (GDP), November non-farm payrolls and figures for the nation’s manufacturing sector.

The macroeconomic reports will reveal the current strength and condition of the world’s largest economy and could also predict how long the Federal Reserve will maintain its monthly purchases at its current pace.

 

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