Gold prices, on Tuesday, December 6, tumbled for a second session, as the dollar firmed up against its leading rivals and U.S. stocks traded mostly higher, pulling investors’ attention away from the precious metal.
Gold investors also remained on the defensive as they faced the strong likelihood of a Federal Reserve interest-rate hike next week and the possibility that monetary policy will tighten at an accelerated pace in 2017, boosting the dollar and cutting demand for the yellow metal.
Gold futures for February delivery GCG7, -0.45% fell $6.40, or 0.5%, to settle at $1,170.10 an ounce. The contract fell below $1,160 an ounce briefly on Monday, flirting with levels not seen since February, MarketWatch reports.
March silver SIH7, -0.76% failed to extend the gains seen over the past three trading sessions, with the contract settling at $16.81 an ounce, down 8.9 cents, or 0.5%.
The ICE U.S. dollar index DXY, +0.31% was trading higher by 0.4% after strong gains in November and early December. Strength in the buck often makes commodities, including gold, less attractive for holders of other currencies.
Based on the Commitments of Traders reports, Ken Ford, president of Warwick Valley Financial Advisors, said the U.S. dollar appears to be “one of the most crowded trades on the planet right now.”
Rounding out action in the metals market, March copper HGH7, -0.95% ended at $2.68 a pound, down 1.8 cents, or 0.7%. January platinum PLF7, -0.30% fell $2.90, or 0.3%, to $935.70 an ounce and March palladium PAH7, -1.15% lost $11.65, or 1.6%, to $734.40 an ounce.
Among exchange-traded funds, the SPDR Gold Trust GLD, -0.10% traded 0.1% lower as gold futures settled, while the iShares Silver Trust ETF SLV, -0.19% was unchanged. The VanEck Vectors Gold Miners ETF GDX, -0.61% added less than 0.1%.