Gold prices maintained a steady drawdown during On Thursday as Federal Reserve chairwoman Janet Yellen’s hawkish economic outlook boosted the dollar.
Gold for August delivery on the Comex division of the New York Mercantile Exchange fell $3.50 to close at $1,143.90 per ounce. Trade ranged from $1,140.60 to $1,148.20.
With recent economic data showing tepid growth, Yellen continued her hawkish mentality while giving a speech to the US congress. The tone wasn’t lost on market participants who expect a rate hike this year.
“Yellen made it clear that rates hikes are on the cards this year,” ABN AMRO said in a report. “We expect the Fed to start hiking rates in September, followed by another hike in December.”
The timing has investors piling capital into the dollar – the greenback was last 0.7 percent stronger at 1.0880 against the euro.
Turning to Europe, overnight the Greek parliament approved the reform proposals securing a third bailout from creditors. The 87 billion euro bailout plan needs additional approval from eurozone countries.
In European data, final consumer inflation of 0.2 percent was as expected as was the core figure at 0.8 percent.
The trade balance of 21.2 billion euros fell just short of consensus. The European Central Bank (ECB) decided to maintain the current minimum bid rate from the eurozone.
In US data, weekly unemployment claims were 281,000, just below the forecast of 284,000. NAHB Housing Market index in July beat expectations at 60, 59 was the consensus.
However, the Philly Fed manufacturing index was at 5.7, grossly missing the 11.9 projection.
Meanwhile in US equities, the Dow Jones industrial average and S&P were up 0.2 percent and 0.6 percent respectively.
As for other precious metals, Comex silver for September delivery was down essentially unchanged at 14.980 per ounce. Trade has ranged from $14.845 to $15.145.
Platinum for October delivery was unmoved at $1,011.60 per ounce, while the most actively traded palladium contract was at $630.25, down $1.70.
(Editing by Tom Jennemann)
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