Investing.com - Gold prices fell in U.S. trading on Friday after stronger-than-expected consumer sentiment numbers dampened expectations the Federal Reserve will stimulate the economy, which would otherwise send the precious metal gaining.
On the Comex division of the New York Mercantile Exchange, gold futures for October delivery were down 0.08% and trading at USD1,615.85 a troy ounce, up from a session low of USD1,611.85 and down from a high of USD1,620.05 a troy ounce early during the session.
Gold futures were likely to test support at USD1,611.85 a troy ounce, the earlier low, and resistance at USD1,620.05, the earlier high.
A Thomson Reuters/University of Michigan preliminary consumer sentiment index for August hit its highest level since May at 73.6, up from 72.3 last month, outpacing economists' forecasts for a 72.4 reading.
The numbers fueled sentiments that despite headwinds from Europe and despite stubbornly high unemployment rates, the U.S. economy will continue to grow and put less pressure on the Federal Reserve to stimulate the economy.
Since the U.S. economy entered a recession over four years ago, the Federal Reserve has taken steps to stimulate recovery, including slashing benchmark interest rates to near zero and rolling out more unorthodox policy tools such as quantitative easing.
Under quantitative easing, the Fed buys Treasury holdings and mortgage-backed securities held by banks, pumping the financial system full of liquidity to further drive down interest rates to boost the economy.
Under such a policy, the dollar weakens and gold rises.
Soft unemployment numbers and sluggish growth rates in the U.S. have sparked talk of more quantitative easing though firming retail sales and other data more recently suggested the Fed may stand down, which sent gold prices falling.
Friday's consumer sentiment figures sent prices falling even more.
Elsewhere on the Comex, silver for September delivery was down 0.65% and trading at USD28.028 a troy ounce, while copper for September delivery was up 1.15% and trading at USD3.421 a pound.
On the Comex division of the New York Mercantile Exchange, gold futures for October delivery were down 0.08% and trading at USD1,615.85 a troy ounce, up from a session low of USD1,611.85 and down from a high of USD1,620.05 a troy ounce early during the session.
Gold futures were likely to test support at USD1,611.85 a troy ounce, the earlier low, and resistance at USD1,620.05, the earlier high.
A Thomson Reuters/University of Michigan preliminary consumer sentiment index for August hit its highest level since May at 73.6, up from 72.3 last month, outpacing economists' forecasts for a 72.4 reading.
The numbers fueled sentiments that despite headwinds from Europe and despite stubbornly high unemployment rates, the U.S. economy will continue to grow and put less pressure on the Federal Reserve to stimulate the economy.
Since the U.S. economy entered a recession over four years ago, the Federal Reserve has taken steps to stimulate recovery, including slashing benchmark interest rates to near zero and rolling out more unorthodox policy tools such as quantitative easing.
Under quantitative easing, the Fed buys Treasury holdings and mortgage-backed securities held by banks, pumping the financial system full of liquidity to further drive down interest rates to boost the economy.
Under such a policy, the dollar weakens and gold rises.
Soft unemployment numbers and sluggish growth rates in the U.S. have sparked talk of more quantitative easing though firming retail sales and other data more recently suggested the Fed may stand down, which sent gold prices falling.
Friday's consumer sentiment figures sent prices falling even more.
Elsewhere on the Comex, silver for September delivery was down 0.65% and trading at USD28.028 a troy ounce, while copper for September delivery was up 1.15% and trading at USD3.421 a pound.