NEW YORK, May 14: US gold futures posted fresh three-month lows at the close Friday, pressured by light-volume speculative liquidation after Thursday’s steep dive, as the dollar extended gains against major rivals, dealers said. June delivery gold on the New York Mercantile Exchange’s COMEX division fell $1.50 to $420.70 an ounce, its lowest close since Feb. 9, after trading from $423 to $419.30.
The dollar looks like it wants to go a great deal higher and there is fund selling across the metals, said Leonard Kaplan, president of Prospector Asset Management. A robust dollar tends to depress US currency alternatives such as gold.
Recent selling in gold was fueled by declining COMEX open interest, as well as redemptions in exchange-traded funds, which had to be matched with a corresponding amount of bullion sales, and crude oil slipping from its highs, analysts said. The level of participation in gold futures trading has taken a tumble since open interest hit an all-time high above 330,000 lots late last year.
But, ongoing physical bargain hunting at cheaper prices was propping up gold, despite the further currency-related selling seen late this week, said analysts at TheBullionDesk.com. Next week is looking set to be another busy one with a careful eye kept on the currencies and their reaction to the week’s data releases including US net capital inflows and inflationary PPI and CPI data, they said in a report.
Estimated final trading volume in COMEX gold futures was a moderate 61,000 lots against Thursday’s official 97,212 lots. Open interest slid 487 lots to 278,123 lots as of May 12.
Friday’s University of Michigan’s preliminary consumer sentiment reading for May came in at 85.3, below April’s 87.7. Spot gold changed hands at $420.00/420.80 an ounce, versus Thursday’s late quote in New York at $421.75/2.50. Friday’s afternoon London fix was at $420.
In other precious metals, platinum sank to a two-week nadir and palladium struck its lowest level since early March.
NYMEX July platinum shed $6.20 to finish at $865.40 an ounce — its lowest close since April 29.
Profit taking has weighed down platinum group metals ahead of British refiner Johnson Matthey’s Monday report on platinum supply/demand conditions. Spot platinum changed hands at $863/867.
June palladium sank to $189.25 an ounce, down $2.65 and at its lowest closing price since March 1. Spot was stuck near $185/189.
July silver fell 2.5 cents to $6.94 an ounce, moving from $6.98 to $6.88. Spot was quoted at $6.91/94, below the last close at $6.93/95. The fix was at $6.88. —Reuters
