By Carla Mozee, MarketWatch
LOS ANGELES (MarketWatch) — Prices for gold fell in Monday’s electronic trading session, suffering along with other metals as the U.S. dollar gathered strength.
During Asian trading hours, gold for June delivery
fell $6.70, or 0.5%, to $1,429.90 an ounce.
Gold had also retreated Friday, slumping 2.2% on the Comex division of the New York Mercantile Exchange.
Monday’s losses for gold futures came as the dollar
stretched gains against key rivals including the Japanese yen
and the euro
. A stronger dollar tends to pull down prices for gold and other dollar-denominated commodities as it makes them more expensive for holders of other currencies.
The dollar got a boost as investors considered the possible curtailing of monetary-policy stimulus by the U.S. Federal Reserve. The central bank has reportedly mapped out a plan for winding down its program of buying $85 billion in bonds each month. Officials were trying to clarify the strategy so markets don’t overreact to their next moves, according to The Wall Street Journal’s report.
China taps Myanmar for energy
China’s $2.5 billion pipeline project in Myanmar is scheduled to be completed this month.
Bringing the Fed’s bond-buying program to an end would make the U.S. dollar more attractive in terms of yield, analysts have said.
Meanwhile, declines in holdings in gold-backed exchange-traded funds remained a concern in the market. Gold holdings in the SPDR Gold Trust
fell about 11 metric tons to 1,051.65 metric tons as of Friday from a week earlier. Declines in gold holdings in the largest U.S. gold-backed ETF have been cited among the reasons for the nearly 8% drop in gold futures in April.
However, analysts said Asian demand for physical gold has been strong.
Prices for other metals were mostly lower on Monday. Silver for July delivery
fell 9 cents, or 0.4%, to $23.57 an ounce, and copper for July delivery
was off about 1 cent, or 0.1%, at $3.345 a pound.