Gold declined today even though the US dollar hit a one month low. Traders were selling gold to cover up losses in equity markets in the US, which gone through a three day sell-off to start the week.
The US dollar slipped after Ben Bernanke offered a rather gloomy assessment of the economy, saying that economic growth in the US has been frustratingly slow. He added that the recovery could not be considered to be established without a period of steady job creation.
However, Bernanke suggested that the recovery could pick up pace in the sector half of the year, while giving no indications of any changes to the Fed’s monetary policy.
The US dollar fell as Bernanke’s downbeat comments on the economy make it unlikely that the Fed will raise interest rates anytime soon.
Gold last traded at US$1,533/oz. Silver and platinum slipped to US$36.44/oz and US$1,816/oz respectively.
Mining companies slipped into the red today. Lonmin (LON:LMI) slipped 4 percent. Lonmin (LON:LMI) and Randgold Resources (LON:RRS) shed 2 percent and 1 percent respectively.
Shares in African Barrick Gold (LON:ABG) slid 9 percent. Other FTSE 250 constituents Petropavlovsk (LON:POG) and Aquarius Platinum (LON:AQP) declined 3.5 percent and 2 percent respectively.
Eurasia Mining (LON:EUA) and Cluff Gold (LON:CLF) outperformed the sector, surging 7 percent and 6 percent respectively.