Bullion metal prices ended lower on Thursday, 16 May 2013. Gold posted moderate losses on Thursday but prices did finish well up from the daily low following some data from World Gold Council and weaker-than-expected U.S. economic data. Investors have moved away from bullions in recent times following rise in US equities.
Gold for June delivery ended lower by $9.3 (0.7%) at $1,386.9 an ounce on the Comex division of the New York Mercantile Exchange on Thursday.
July silver ended lower by $0.04 cents (0.01%) at $22.62 an ounce on Thursday.
There has been lackluster physical gold demand in Asia that is also a bearish weight on gold recently. Reports overnight said new India government regulations to thwart gold speculation have worked to decrease consumer demand in that gold-hungry nation.
The World Gold Council said in a report on Thursday that investors during the first quarter didn't buy enough physical gold to offset outflows from gold-exchanged traded funds. Total world gold demand was 963 metric tons in the first quarter, down 13% from the same time a year ago.
Federal Reserve Bank of Philadelphia president Charles Plosser said in Italy Thursday that the central banks of the world cannot create wealth and said central banks do not have the tools to fix the present economic and financial problems in the major industrialized countries.
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In the currency market, the dollar index, which weighs the strength of the dollar against a basket of six other currencies, fell by 0.2% on Thursday.
Among economic data expected at Wall Street on Thursday, housing starts fell 16.5% in April to 853,000 from a downwardly revised 1.021 million (from 1.036 million) in March. That was the smallest number of starts since November 2012. The consensus expected housing starts to fall to 970,000. Multifamily construction, which tends to be highly volatile, fell to 243,000 in April from 398,000 in March. The drop is likely a reversion to the mean as multifamily construction has been running much hotter than its 12-month average.
The initial claims level jumped to 360,000, the highest level since February (excluding the volatility from the Easter holiday problems), for the week ending May 11 from an upwardly revised 328,000 (from 323,000) for the week ending May 4. The consensus expected the initial claims level to increase to 330,000.
The CPI fell 0.4% in April after declining 0.2% in March. The consensus expected consumer prices to fall 0.2%. Excluding food and energy, core CPI increased 0.1% for a second consecutive month. The consensus expected these prices to increase 0.2%. Separately, the Philadelphia Fed's Business Outlook showed that manufacturing activity in the Philadelphia region contracted in May. The index fell to -5.2 from 1.3 in April. The consensus expected the Philly Fed Index to increase to 2.5.
At the MCX, gold prices for June delivery closed lower by Rs 179 (0.7) at Rs 26,131 per ten grams. Prices rose to a high of Rs 26,222 per 10 grams and fell to a low of Rs 25,860 per 10 grams during the day's trading.
At the MCX, silver prices for July delivery closed lower by Rs 52 (0.12%) at Rs 43,262/Kg. Prices opened at Rs 43,184/kg and fell to a low of Rs 42,281/Kg during the day's trading.
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