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Homemetal commoditiesGold extends losses for third day; settles down at $1,225.50

Gold extends losses for third day; settles down at $1,225.50

Gold settled lower for a third consecutive session on Wednesday after minutes of the Federal Reserve's December meeting showed members of the central bank generally supported decreasing the monthly asset purchasing program by $10 billion.

Earlier, the dollar touched a one-month high versus the euro on Wednesday after data showed U.S. private employers added 238,000 jobs in December, the best read in 13 months.

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Spot gold dropped to a session low of $1,218.44 an ounce, after snapping a five-day rally on Tuesday. It was last down 0.8 percent to $1,221 an ounce.

U.S. gold futures for February delivery settled $4.10 lower at $1,225.50 an ounce.

The metal is still up 1.8 percent this year after tumbling 28 percent in 2013, its first annual loss in 32 years, as the Fed geared up to taper its stimulus.

"The market probably got a bit carried away at the beginning (of the year), helped by the firm rejection of the lows on Dec. 31 and the news about strong Chinese demand, which now seems to have stabilized,'' Saxo Bank's head of commodity strategy Ole Hansen said.

Chart: Precious Metals

"As we approach non-farm payrolls data on Friday traders will probably turn cautious again, considering the expectations for a continued improvement in the U.S. job market and thereby additional tapering over the coming months.''

The non-farm payrolls are seen as a key indicator of the U.S. monetary policy outlook, given that the Fed has explicitly said it will await an improvement in the jobs market before it accelerates its tapering program.

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—By Reuters


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