Gold edged lower on Wednesday

Gold edged lower on Wednesday, tracking falls in industrial metals and equities, as concerns about global economic growth weighed on market sentiment amid thin year-end trading volumes.

Investors were cautious as the latest data out of the United States sent mixed signals. Improving labor market conditions lifted consumer confidence to an eight-month high in December, but persistently weak house prices remain an obstacle to faster economic growth.

Industrial metals, along with equities, eased in thin holiday trade.

“There have been a couple of positive signs on the U.S. economy, but it’s hard to be hung up on them too much,” said a Singapore-based trader.

“The economic prospects are so dire that it seems to have taken people’s appetite away from commodities ,

especially in industrial metals, late in this calendar year.”

Although gold traditionally has a safe haven appeal, the euro zone debt crisis is threatening the global economy, causing a liquidity shortage in markets and forcing investors to abandon their gold positions to cover losses elsewhere.

Spot gold edged down 0.3 percent to $1,588.29 an ounce by 0307 GMT (10:07 p.m. EDT), on course for a third consecutive session of losses.

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Posted by admin on Dec 28 2011. Filed under Gold price. You can follow any responses to this entry through the RSS 2.0. You can leave a response or trackback to this entry