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Gold Lingers Below $1,600

Gold Lingers Below $1,600
2/28/2013 7:06 AM ET

The price of gold was extending losses Thursday morning on profit taking, with the U.S. dollar and equity markets steady despite euro zone worries.

Meanwhile, India held its gold import duty unchanged in today's Federal Budget, defying industry expectations for an increase rates to curb demand and rein in a record current account deficit.

Gold for April delivery, the most actively traded contract, shed $6.60 to $1589.10 an ounce. Yesterday, gold settled sharply lower after some upbeat global macroeconomic data out of the U.S. and Europe, and on developments in Italy. Political parities in Italy have begun exploring possibilities of forming a government after initial rhetoric from various groups to the contrary.

Holdings of SPDR Gold Trust, the world's largest gold-backed exchange-traded fund, moved down to 1,270.44 tons from 1,272.85 tons.

Meanwhile, the U.S. dollar was hovering around its 2-month high versus the euro and its 30-month high against sterling. The buck was trading around its two-and half year high versus the yen and ticking higher against the Swiss franc.

In economic news, inflation in the euro area, as per the harmonized index of consumer prices, weakened in January as estimated earlier, final data from statistical office Eurostat showed. The harmonized index of consumer prices (HICP), measured under the EU methodology, increased 2 percent on an annual basis in January, after rising 2.2 percent in December. The latest figure matched preliminary estimates.

German unemployment declined unexpectedly by 3,000 in February from the prior month, the Federal Labor Agency said. However, the jobless rate held steady at 6.9 percent in February, above the consensus forecast to 6.8 percent.

Elsewhere, the prices of silver and platinum were moving lower in morning deals.

From the U.S., the Commerce Department will release the second read of its fourth quarter GDP report at 8:30 a.m. ET. Economists expect GDP to be upwardly revised to show 0.5 percent growth for the quarter compared to the 0.1 percent drop estimated earlier.

Simultaneously, the Labor Department will release its weekly jobless claims report. The consensus estimates call for a decline in jobless claims to 360,000 in the week ended February 23rd compared to 362,000 in the previous week.

Later during the session, the ISM-Chicago is due to release the results of its regional manufacturing survey. The business barometer based on the survey is expected to decline to 55 in February from 55.6 in January.

by RTT Staff Writer

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