Gold Ends Lower Amid Fed Concerns

(RTTNews) - Gold futures ended lower Tuesday, on concerns the Federal Reserve would begin scaling down its quantitative easing program by the end of the year, with investors awaiting some key economic data later in the week, including the U.S. trade balance, weekly jobless claims and industrial production.

Investors continued to ponder over speculations the Federal Reserve would start to scale down its $85 billion monthly bond-buying program by the year end, after some better than expected October jobs data from the U.S., notwithstanding the 16-day government shutdown.

Gold for December delivery, the most actively traded contract, dropped $9.90 or 0.8 percent to close at $1,271.20 an ounce Tuesday on the Comex division of the New York Mercantile Exchange.

Gold for December delivery scaled an intraday high of $1,285.40 and a low of $1,272.60 an ounce.

Yesterday, gold settled marginally lower after some upbeat data from China and concerns the Federal Reserve would begin tapering its quantitative easing program soon after last week's encouraging jobs data from the U.S.

Holdings of SPDR Gold Trust, the world's largest gold-backed exchange-traded fund, were unchanged at 868.42 tons.

The dollar index, which tracks the U.S. unit against six major currencies, traded at 81.13 on Tuesday, up from 81.08 late Monday in North American trade. The dollar scaled a high of 81.46 intraday and a low of 81.02.

The euro traded higher against the dollar at $1.3441 on Tuesday, as compared to its previous close of $1.3406 late Monday in North America. The euro scaled a high of $1.3456 intraday and a low of $1.3360.

In economic news from the eurozone, Germany's EU harmonized inflation weakened in October at a faster pace than estimated earlier, final figures released by the Federal Statistical Office showed. The harmonized index of consumer prices advanced 1.2 percent in October from the same month of last year, slightly slower than the 1.3 percent gain the government had estimated earlier. In September, prices had recorded a 1.6 percent increase.

Germany's wholesale trade prices declined at the fastest rate since late 2009 in October, data released by Destatis showed. The wholesale price index fell 2.7 percent year-on-year, following a 2.2 percent drop in September. The index dropped for the third successive month and the rate of decline was the biggest since November 2009, when prices decreased 3.7 percent, the agency said.

Elsewhere, U.K. inflation slowed more than expected in October to the lowest since September 2012, official data showed. Nonetheless, it hovers above the 2 percent target. Consumer price inflation dipped to 2.2 percent from 2.7 percent in September, the Office for National Statistics said. It fell below the 2.5 percent consensus.

An indicator of the performance of the British economy rose sharply in September, revealing the ongoing recovery will continue in the coming months, data from the Conference Board showed. The leading economic index advanced 1.5 percent sequentially to 107 in September. This followed a 1.2 percent gain in August and a 0.7 percent rise in July.