On Tuesday gold futures extended losses, dropping to more than two month lows as the broadly stronger dollar undermined investor demand for the yellow metal.
Gold
for December delivery touched lows of $1,266.00, the weakest since June
18 and was last down 1.39% to $1,269.50 an ounce on the Comex division
of the New York Mercantile Exchange.
Elsewhere in metals trading, palladium prices were sharply lower, with Nymex palladium for December delivery dropping 2.3% to $888.6 an ounce, off Monday’s thirteen-and-a-half year highs of $913.00. Palladium, which is used in auto catalysts, has rallied in recent sessions amid concerns that more far reaching sanctions against Russia, the world's largest palladium producer, could hit supplies.
Meanwhile, silver for December delivery was down 1.25% to trade at $19.24 an ounce, while copper for December delivery slid 0.24% to $3.152 a pound.
The euro zone currency fell to fresh one year lows against the dollar amid mounting expectations that the European Central Bank will announce quantitative easing measures as a way to shore up long term inflation expectations in the euro area.
Concerns that sanctions against Russia would act as a drag on growth in the euro zone also weighed on the single currency.
The dollar rose to 10-month peaks against the Swiss franc and to 7-month highs against the yen, bolstered by weakness in the euro. The stronger dollar outweighed safe haven demand for gold stemming from heightened tensions between Russia and Ukraine.
Investors are anticipating ahead to the latest U.S. employment report, due for release on Friday, for further indications on the strength of the recovery in the labor market, a key factor in deciding the future path of monetary policy.
