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Gold Closes Lower On Weak Demand

Gold futures closed lower after two-day gain Tuesday, on weak demand for the precious metal even as the dollar ticked lower ahead of the FOMC minutes release later today.

Gold for June delivery, the most actively traded contract, dropped $7.70 or 0.5 percent to close at $1,672.00 an ounce Tuesday on the Comex division of the New York Mercantile Exchange.

Gold traded at an intraday high of $1,682.70 an ounce and a low of $1668.60 an ounce.

Yesterday, gold extended gains for a second day with some positive economic data on the U.S. manufacturing sector activity, while the dollar weakened.

The dollar index, which tracks the U.S. unit against six major currencies, traded at 78.873 on Tuesday, down from 78.973 in North American trade late Monday. The dollar scaled a high of 79.01 intraday, with a low of 78.66.

The euro was trading lower against the dollar at $1.3317 on Tuesday, as compared to $1.3334 late Monday. The euro had scaled a high of $1.3367 intraday with a low of $1.3300.

In economic news from the U.S., the Commerce Department figures put the February estimate of new manufacturing orders at $468.4 billion, a 1.3 percent increase from January levels. And while most economists had predicted a rebound following the 1.1 percent decline in January - initially reported as a 1 percent decline - many had hoped for a slightly more robust 1.5 percent increase.

Elsewhere, euro zone producer price inflation eased to 3.6 percent year-on-year in February from a revised 3.8 percent in January, Eurostat said. The inflation rate, nonetheless, stayed above the consensus forecast of 3.5 percent. On a monthly basis, the industrial producer price index climbed 0.6 percent, following a 0.8 percent gain in January. Economists were expecting an increase of 0.5 percent.

by RTTNews Staff Writer

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