Gold made a poor start to what may turn out to be some crucial days for the metal as private employment was strong and the US economy grew by more than expected.
US GDP rose by 1.7% in the three months to June, against forecasts for 1% growth, while ADP’s survey came in slightly ahead of forecast with 200,000 private jobs created in July.
The data came ahead of Ben Bernanke’s report following the latest meeting of the Federal Reserve’s interest rate setting committee this evening and non-farm payroll numbers on Friday.
Economists said that the growth seen in the second quarter may not be enough to persuade the Fed to start tapering, but a very strong payroll figure may change that view.
Monetary stimulus is considered good for gold and the prospect of its being scaled back has hurt gold price year. The price has fallen by more than 20% even with July set to be to be the best month’s performance for the metal since March.
Spot gold was trading down US$12.53 at US$1,313, silver was US$19.60, while platinum shed US$6 to US$1,427.
Major movers
Randgold Resources down 20p at 4,803p
Fresnillo up 4p at 1,052p
Anglo American up 3p at 1,422p