NEW YORK (Dow Jones) – Gold futures retreated just shy of a new record high Monday as the metal of the rally lost momentum and a stronger dollar under pressure from the market. Most actively traded, August-delivery lost $ 17.60, or 1.4%, to $ 1,238.60 an ounce on the Comex to regulate the division of the New York Mercantile Exchange. It retreated from an intraday high of $ 1,263.70, just shy of the all-time intraday high of $ 1,266.50 last week.
“We have no catalyst to give that push to a new record, said Frank Lesh, broker and analyst with Future Path Trading in Chicago.
A stronger dollar also hurt gold by making the dollar-denominated metals more expensive for buyers with other currencies. Shortly after the gold market closed, the euro fell 0.3% on caution ahead of a major European Central Bank lending facility later this week end.
Some in the market had bought gold at the beginning of the session on continued nervousness about the growth of world economy after the weekend of 20 Group meeting, where leaders agreed to reduce debt, but also warned that synchronized fiscal adjustment could be adversely impact on the global economic recovery.
But the safe harbor support for gold as investors mulled wine wore off the effects of the meeting and did not feel too pessimistic about the economy, or see something new on inflation. Gold is often seen as an inflation hedge.
“We had a number of risk premium built into the market for the G-20 meeting,” said Sterling Smith, an analyst with Country Hedging in Inver Grove Heights, Minnesota “The market is now a part of the shaving.”
Without enough momentum to propel it to top the record, “of course we have just seen some profit-taking,” said Jim Steel, senior vice president and analyst at HSBC metals.
Gold has been driven in recent months by escalating fears that the global economic recovery will stall, with the August contract hitting an intraday record of $ 1,266.50 last week.
Gold is often seen held its value better than other assets in times of economic uncertainty and therefore more motivated and concerned about the debt problem in European countries like Greece, Spain, Portugal and Hungary combined with less-than-encouraging U.S. economic data.
Other precious metals traded in New York were also under pressure from the stronger dollar. Comex September silver fell 43.4 cents, or 2.3%, to settle at $ 18,718 per ounce. Nymex October platinum fell $ 4.10, or 0.3%, to settle at $ 1,570.40 an ounce. September palladium fell $ 5.45 on the stock, or 1.1%, to settle at $ 472.45 per ounce.
source:online.wsj.com
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