Adjust font size:

Gold futures on the COMEX Division of the New York Mercantile Exchange declined on Wednesday, the sixth drop in eight trading days, as the U.S. dollar went higher against the euro and dampened the appeal of the precious metal.

The most active gold contract for February delivery fell four U. S. dollars, or 0.3 percent, to 1,613.6 dollars per ounce.

Market analysts mainly attributed gold's weak performance to strengthened U.S. dollar, which hiked almost two percent against six other currencies.

The dollar regained its appeal as the investment currency of choice, while the European Central Bank (ECB) loans failed to convince investors it would ease Europe's deep-seated debt problems, said Mike Daley, a senior gold analyst with PFGBest Group.

ECB on Wednesday offered 641 billion dollars of loan to 523 euro-area banks in a massive three-year funding operation. However, the dollar index, which measures the price of dollar against six other counterparts, traded around 80, up 0.198 percent from the previous trading day.

Besides, the year-end selling by funds and tight liquidity in European interbank money markets have also contributed to recent price falls, said a trader.

Gold has been pressured in recent months, with its safe-haven appeal fading as investors flock to the dollar and U.S. bonds amid Europe's deepening sovereign-debt crisis.

Silver for March delivery lost 28.7 U.S. cents, or 0.97 percent, to 29.249 dollars per ounce. Platinum for January delivery shed 1. 2 dollars, or 0.08 percent, to 1,431.7 dollars per ounce.

Print

E-mail