Gold rebounds as market takes breather from Fed taper selling

Commodities Dec 13, 2013 02:50PM ET





Bond purchases seek to boost recovery by pushing down interest rates, weakening the dollar in the process and making gold an attractive hedge.



On the Comex division of the New York Mercantile Exchange, gold futures for February delivery traded at USD1,235.00 during U.S. afternoon hours, up 0.82%.



Gold prices hit a session low of USD1,220.10 a troy ounce and high of USD1,238.00 a troy ounce.



Gold futures were likely to find support at USD1,211.20 a troy ounce, the low from Dec. 6, and resistance at USD1,267.30, Tuesday's high.



The February contract settled down 2.57% at USD1,224.90 a troy ounce on Thursday.



Better-than-expected retail sales, consumer sentiment and jobless reports have many investors betting the Fed is growing closer to trimming its monthly bond-purchasing program, which has supported gold for over a year by weakening the dollar.



Earlier Friday, wholesale pricing data did the same.



The Labor Department reported earlier that the U.S. producer price index fell 0.1% last month, in line with expectations, after a 0.2% decline in October.



Core producer price inflation, which excludes food and energy, rose 0.1% in November after a 0.2% increase the previous month, also in line with consensus forecasts.



Investors interpreted the data as another cue to prompt the Fed to begin winding down monetary stimulus programs at its Dec. 17-18 policy meeting or in early 2014.



Gold weakened to levels ripe for bottom fishers on Friday, though the yellow metal still remained on track to post its first yearly loss this year in 13 years.



Elsewhere on the Comex, silver for March delivery was up 1.05% at USD19.658 a troy ounce, while copper for March delivery was up 0.43% and trading at USD3.310 a pound.





















Investing.com - Gold prices rose on Friday amid demand from bottom fishers who viewed the commodity as oversold on expectations for the Federal Reserve to begin tapering its USD85 billion in monthly asset purchases, possibly as early as next week.Bond purchases seek to boost recovery by pushing down interest rates, weakening the dollar in the process and making gold an attractive hedge.On the Comex division of the New York Mercantile Exchange, gold futures for February delivery traded at USD1,235.00 during U.S. afternoon hours, up 0.82%.Gold prices hit a session low of USD1,220.10 a troy ounce and high of USD1,238.00 a troy ounce.Gold futures were likely to find support at USD1,211.20 a troy ounce, the low from Dec. 6, and resistance at USD1,267.30, Tuesday's high.The February contract settled down 2.57% at USD1,224.90 a troy ounce on Thursday.Better-than-expected retail sales, consumer sentiment and jobless reports have many investors betting the Fed is growing closer to trimming its monthly bond-purchasing program, which has supported gold for over a year by weakening the dollar.Earlier Friday, wholesale pricing data did the same.The Labor Department reported earlier that the U.S. producer price index fell 0.1% last month, in line with expectations, after a 0.2% decline in October.Core producer price inflation, which excludes food and energy, rose 0.1% in November after a 0.2% increase the previous month, also in line with consensus forecasts.Investors interpreted the data as another cue to prompt the Fed to begin winding down monetary stimulus programs at its Dec. 17-18 policy meeting or in early 2014.Gold weakened to levels ripe for bottom fishers on Friday, though the yellow metal still remained on track to post its first yearly loss this year in 13 years.Elsewhere on the Comex, silver for March delivery was up 1.05% at USD19.658 a troy ounce, while copper for March delivery was up 0.43% and trading at USD3.310 a pound.

Gold rebounds as market takes breather from Fed taper selling

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