Gold prices traded slightly lower as market participants ignore near-term fundamentals and decide to use their capital for other products.
Gold for June delivery on the Comex division of the New York Mercantile Exchange was down $4.6 to close at $1,204.10 per ounce. Trade ranged from $1,200.80 to $1,212.40.
Yesterday’s release of the Federal Open Market Committee (FOMC) minutes from the April 28-29 meeting effectively ruled out a rise in interest rates in June, in line with market expectations, but it gave no clue on whether a rise from near-zero levels could happen in September, December or even in 2016.
“As we get closer to the rate hike it appears that the market’s reaction to the Fed meetings and their respective minutes are becoming more muted,” Triland Metals said. “For now gold doesn’t have the catalyst to build up an investment case and players continue to trade other products leading to price action that is uninspiring (to put it nicely)”
In today’s US data, existing home sales fell by 3.3 percent month-on-month in April to an annualized rate of 5.04 million, which was well below the 5.23 forecast. US flash reading of the Markit manufacturing PMI fell to 53.8 in May from 54.1 in April. New orders growth dropped to the slowest pace since January 2014.
While in China, HSBC flash manufacturing PMI at 49.1 missed the expected 49.4, the miss raised expectations that Beijing will roll out further stimulus measures to prop up growth rates.
Meanwhile in the eurozone, the French flash manufacturing PMI was better than expected at 49.3 but the country’s flash services PMI disappointed at 51.6. Germany’s flash manufacturing PMI at 51.4 was lower than forecast, as was its flash services PMI at 52.9.
The eurozone flash manufacturing PMI was better than expected at 52.3 but its flash services PMI undershot at 53.3. The bloc’s current account was also lower than forecast at 18.6 billion euros.
The Dow Jones industrial average and S&P were up 0.1 percent and 0.2 percent respectively, while the euro was 0.3 percent stronger at $1.1134 against the dollar.
As for the other precious metals, Comex silver for July delivery was up less than one cent to close at $17.132 per ounce. Trade ranged from $17 to $17.250.
Platinum futures for July delivery on the Nymex were down $2.20 at $1,154.70 per ounce, while the most-actively traded palladium contract was at $779, up $2.15.
(Editing by Tom Jennemann)
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