Gold Prices Head Lower as U.S. Inflation Eases

by Bullion Prices Staff on November 16, 2011

U.S. gold prices finished lower Wednesday as the greenback continued gaining as the euro faltered. Gold was also pressured by a report from the U.S. Labor Department which showed tamer American inflation. December gold prices fell $7.90, or 0.4%, to $1,774.30 an ounce on the Comex division of the New York Mercantile Exchange.

"Cautionary selling in gold continued after more euro zone headlines negatively affected the outlook for economic recovery and reform there. More portfolio managers are opting for cash and not entering into any risk," said George Gero, vice president of RBC Capital Markets, according to Reuters.

Gold prices moved from an intraday low of $1,753.90 an ounce to a high at $1,784.80.

For inflation, gold is often purchased as a hedge against it. On Wednesday, the U.S. Labor Department said inflation fell 0.1% in October. It was the first decline since June as it followed increases of 0.3% in September, 0.4% in August and 0.5% in July. The main reason U.S. inflation dipped, however, was due to falling gasoline prices in October. That could change. Crude-oil was as low as $75 a barrel in early October. On Wednesday, oil prices topped $100 a barrel — the first time since July and when inflation last ticked higher after dipping.

In other precious metals, December silver futures prices tumbled 63.4 cents, or 1.8%, to $33.82 an ounce.

In New York PGM futures prices, December palladium futures declined $12.60, or 1.9%, to $654.45 an ounce while January platinum futures lost $11.50, or 0.7%, to $1,631.20 an ounce. Until Wednesday, palladium had gained for two consecutive sessions. Platinum has now declined for three straight sessions.

United States Mint Bullion Coins

No bullion coin gains were published by the United States Mint on Wednesday. The most recent United States Mint bullion product sales are provided below in the daily, November 2011 and YTD 2011 columns.

United States Mint 2011 Bullion Coin Sales
  Wednesday Gains November 2011 2011 Totals
1 oz American Gold Eagles 0 11,500 817,500
1/2 oz American Gold Eagles 0 0 65,000
1/4 oz American Gold Eagles 0 2,000 80,000
1/10 oz American Gold Eagles 0 5,000 360,000
1 oz American Gold Buffalo 0 1,500 146,500
5 oz America the Beautiful Silver not reported 393,300
1 oz American Silver Eagle 0 819,000 37,294,500

 

Notes. Figures above are in coins, not ounces sold.

London Bullion Prices

London bullion prices were mixed yet again. This time three of the major precious metals decline with silver the exception. From Tuesday PM to Wednesday PM fixings:

  • Gold prices declined $29, or 1.6%, to $1,756 an ounce,
  • Silver added 43 cents, or 1.3%, to $34.45 an ounce,
  • Palladium added $6, or 0.9%, to $655 an ounce, and
  • Platinum declined $1, or 0.1%, to $1,628 an ounce

Check this site’s┬áhome page for current metal prices.

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