Gold futures edge lower ahead of Swiss gold referendum
London (Nov 27) Gold prices edged lower on Thursday, traders eyed an upcoming Swiss referendum on central bank gold reserves for more trading cues.
On the Comex division of the New York Mercantile Exchange, gold futures for February delivery dipped $4.40, or 0.37%, to trade at $1,193.10 a troy ounce during European morning hours.
A day earlier, Comex gold prices lost 30 cents, or 0.03%, to settle at $1,197.50 an ounce.
Futures were likely to find support at $1,177.00, the low from November 20, and resistance at $1,208.20, the high from November 21.
Swiss voters go to the polls on November 30 to decide whether the Swiss National Bank would have to hold at least 20% of its assets in the precious metal, up from 8% now.
The most-recent opinion poll released last week showed that support for the "Save our Swiss gold" proposal slipped to 38%, down from 44% in a survey conducted last month.
The motion, if passed, would likely boost gold prices from current levels.
Trade volumes were expected to remain light on Thursday, with U.S. markets closed for the Thanksgiving holiday.
Data on Wednesday showed that initial jobless claims rose to the highest level since early September last week, while personal spending rose less than expected. Durable goods orders rose in line with forecasts, but core durable goods orders fell unexpectedly.
Other reports showed that U.S. consumer sentiment was revised lower, manufacturing activity in the Chicago region slowed and data from the housing sector was mixed.
The data indicated that the recovery in the U.S. is continuing, albeit at a modest pace.
Gold prices are likely to remain vulnerable in the near-term amid indications a strengthening U.S. economic recovery will force the Federal Reserve to start raising interest rates sooner and faster than previously thought.
Expectations of higher borrowing rates going forward is considered bearish for gold, as the precious metal struggles to compete with yield-bearing assets when rates are on the rise.
Also on the Comex, silver futures for March tumbled 22.3 cents, or 1.34%, to trade at $16.38 a troy ounce.
Elsewhere in metals trading, copper for March delivery inched up 0.7 cents, or 0.23%, to trade at $2.963 a pound.
Comex copper prices fell to an eight-month low of $2.935 on Wednesday amid ongoing concerns over the health of the global economy.
Copper is sensitive to the economic growth outlook because of its widespread uses across industries.
Source: MoneyControl
