Gold for February delivery fell $2.6 (0.2%) to settle at $1,646.3 an ounce on the Comex division of the New York Mercantile Exchange on Monday. Gold futures have tallied a loss of $42.50 an ounce, or 2.5%, over three trading sessions. Gold ended 2012 with an overall yearly gain of around 7%, which marks the 12th consecutive year the yellow metal has posted yearly gains.
On Monday, March silver rose $0.14, or 0.5% to settle at $30.08 an ounce. Silver finished 8.3% higher for the year 2012.
Investors continued to weigh Fed's latest FOMC minutes. The minutes of the latest meeting of the Federal Reserve's Open Market Committee were released on last Thursday afternoon and they somewhat surprisingly revealed some FOMC members believe that quantitative easing of U.S. monetary policy should be wound down during 2013. That spooked the precious metals market bulls and gave the U.S. dollar index another boost higher. The past four years of very easy U.S. monetary policy have been an underlying bullish factor for the raw commodity sector, including gold and silver.
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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 Monday. The U.S. dollar index dropped from its earlier higher levels to trade below on Monday. The index last Friday hit a four-week high, in the wake of the greenback-bullish FOMC minutes issued last week.
In the latest report, HSBC cut its 2013 average gold price outlook on Thursday to $1,760 from $1,850, adding to the gold market's bearish sentiment.
The shine of last week's temporary U.S. fiscal cliff agreement by U.S. lawmakers has quickly faded. The market place is now looking forward with trepidation to the upcoming negotiations between the U.S. Congress and the Obama administration on budget and spending matters. Such is likely to limit trader and investor participation in many markets in the coming weeks.
At the MCX, gold prices for February delivery closed lower by Rs 44 (0.14%) at Rs 30,863 per ten grams. Prices rose to a high of Rs 31,058 per 10 grams and fell to a low of Rs 30,835 per 10 grams during the day's trading.
At the MCX, silver prices for March delivery closed lower by Rs 3 (0.0%) at Rs 57,983/Kg. Prices opened at Rs 58,200/kg and fell to a low of Rs 57,768/Kg during the day's trading.
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