Gold Futures Relinquish Gains as U.S. Dollar Rebounds

Gold futures settled modestly lower Wednesday as the U.S. dollar bounced back from yesterday’s slide.

COMEX gold for February 2012 delivery – the most actively-traded contract – ended with a loss of $4.00, or 0.3%, at $1,613.60 per ounce. The yellow metal had climbed to as high as $1,643.70 in overnight trading, but relinquished its gain as the U.S. Dollar Index rose 0.2% to 79.987 in afternoon trading.

Silver futures finished in the red as well, with the COMEX February 2012 contract sliding $0.29, or 1.0%, to $29.25 per ounce.  Other metals were mixed, with platinum dipping 0.1% to $1,431.70 per ounce, palladium rising 0.9% to $634.10 per ounce, and copper advancing 0.7% to $3.40 per pound.

Citigroup analyst David Wilson wrote in a note to clients on Wednesday that “Gold has been trading like a risk asset, along with other metals, and trading on the dollar-euro exchange rate…The underlying issues, in terms of the macro environment, remain fragile. Europe is going to be in recession next year, the U.S. maybe will see modest growth, and China (is) slowing. That is still positive for gold… but right now gold is trading as a risk rather than a risk hedge.”

Source;  http://www.goldalert.com/2011/12/gold-futures-relinquish-gains-as-u-s-dollar-rebounds/