Gold hits a three-month low on Tuesday
Bullion prices ended the U.S. day session modestly lower on Tuesday, 09 September 2014 at Comex. Gold hit a three-month low on Tuesday. Gold dropped for a second session on Tuesday on expectations that the Federal Reserve may tighten monetary policy sooner than expected.
Gold for December delivery slid $5.80, or 0.5%, to settle at $1,248.50 an ounce.
December silver fell 4 cents at $18.84 an ounce.
Early, tepid short covering gave way to more technical selling pressure. Focus is on the currency markets this week, where the U.S. dollar index has hit a 14-month high, while the Euro currency has slumped to a 14-month low. Diverging economies and monetary policies in the U.S. and the European Union are prompting their currencies to trend in opposite directions.
The strong U.S. dollar has been a bearish outside market force working against most of the raw commodity sector recently, including gold and silver. The deflating Euro currency has also been a negative for raw commodities, due to the concerns in the EU regarding the potential for sustained deflationary consumer and producer price pressures.
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Economic data at Wall Street was limited to the Job Openings and Labor Turnover Survey for July, which indicated job opening decreased to 4.673 million from 4.675 million.
On the geopolitical front there have been no major, markets-moving developments the past several days. The Russia-Ukraine cease-fire appears to be generally holding. New sanctions against Russia are set to be implemented by the European Union this weekmostly eliminating the ability of Russian businesses to raise capital in Europe.
Recent reports have said consumer demand for physical gold has been light compared to historical standards, especially from major gold consumer India. India's Diwali festival is upcoming and demand for gold bullion from India rises.
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