Gold Futures Fall Amid Concerns Over Egypt and Economic Data

Strategic Insights -

Gold futures declined slightly on Wednesday due to concerns over political instability in Egypt and stronger-than-expected economic data. Despite being considered a refuge investment, gold has come under pressure this month as investors regain confidence in the stock market and buy growth-sensitive commodities like copper. A stronger dollar, which makes the dollar-denominated metal more expensive for buyers using other currencies, also damped demand for gold.

Key Takeaways:

  • Gold futures fell $3.40, or 0.3%, to $1,336.90 a pound on the Comex division of the New York Mercantile Exchange.
  • A stronger dollar was the biggest pressure on gold, making it more expensive for buyers using other currencies.
  • The ICE Futures U.S. Dollar Index was recently up 0.05% due to concerns over Egypt and the euro zone debt problems.
  • Gold is considered a refuge investment, but it has been under pressure this month as investors regain confidence in the stock market.
  • Pro and anti-government forces in Egypt clashed on Wednesday after a day of mass peaceful protests, prompting safe-haven buying of the dollar.
  • Stronger-than-expected economic data further undermined gold's role as a refuge, with private-sector jobs in the U.S. rising by 187,000 last month.
  • Economists had expected ADP to report a job gain of 143,000 in January.

Statistics:

  • Gold futures declined $3.40, or 0.3%, to $1,336.90 a pound on the Comex division of the New York Mercantile Exchange.
  • The ICE Futures U.S. Dollar Index was recently up 0.05%.
  • Private-sector jobs in the U.S. rose by 187,000 last month, according to ADP and Macroeconomic Advisers.
  • Economists had expected ADP to report a job gain of 143,000 in January.

Sources:

  • Dow Jones Commodities News via Comtex
  • Automatic Data Processing Inc. (ADP)
  • Macroeconomic Advisers
  • New York Mercantile Exchange
  • Comtex