Gold Retreats Below $1,090/oz, Silver Drops Under $16.50/oz – 1/27/2010

by Bullion Prices Staff on January 27, 2010

US gold futures, and other precious metals, finished lower on Wednesday as the US dollar rallied against the euro and other world currencies. China’s move to slow lending (and growth) was again cited as a factor in moving the dollar and pulling down gold. By the end of the day, gold fell 1.3%, silver lost 2.5% and platinum declined 2.6%. New York precious metal figures follow:

  • Gold for April delivery fell $13.80 to close at $1,085.70 an ounce. It ranged from $1,103.30 to $1,085.60.

  • Silver for March delivery plummeted 42.0 cents to finish at $16.440 an ounce. It ranged from $16.965 to $16.425.

  • April platinum plunged $39.20 to end at $1,492.10 an ounce. It ranged from $1,537.00 to $1,491.10.

In PM London bullion prices, the benchmark gold price was fixed earlier in the North American day to $1,094.75 an ounce, which was an increase of $1.50 from Tuesday. Silver fell 5 cents to $16.740 an ounce. Platinum was settled at $1,519.00 an ounce for a gain of $7.00.

Notable bullion quotes follow:

"The gold market is still being hurt by indications of slightly tighter monetary policy in China,” James Steel, gold analyst at HSBC in New York, said on MarketWatch. "This year Chinese monetary changes seem to be gaining an influence in gold. We’re not only looking at the Fed as we used to."

"On the bright side for gold, the nearing Year of the Tiger is making for an expected but welcome temporary boost in gold sales in China. Such demand is hopefully offsetting a portion of the lack of same on the part of the gold ETF niche — one that has not pulled its weight thus far in 2010," wrote Jon Nadler, senior analyst at Kitco Metals, Inc.

In related precious metals news, a closer look at United States Mint bullion sales from last year is now available. Demand was on fire, according to the newly released US Mint 2009 Annual Report. In Fiscal Year 2009, the US Mint recorded bullion sales of $1.69 billion dollars, which smashed the 2008 record level of $948.8 million by 78.6%.

"Our bullion sales approached $1.7 billion, our highest total ever and nearly 80 percent above last year’s sales revenue," US Mint Director Ed Moy stated in the annual report. "In FY 2008, bullion accounted for 34 percent of our total sales revenue. In FY 2009, it was 58 percent."

"We were able to meet demand for 22-karat gold and silver one-ounce bullion coins by the third quarter of FY 2009. Our West Point facility increased its output by 50 percent from last year, adding one bullion coining press but no additional personnel, while also achieving an improved safety record."

Gold, considered a hedge during times of high inflation and economic uncertainty, tends to follow oil and move opposite to the U.S. dollar. (New York crude-oil for March delivery declined $1.04, or 1.4 percent, to $73.67 a barrel.) A rising greenback makes dollar-denominated commodities, like bullion, more expensive for holders of other world currencies.

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