Gold Retreats for Second Day, Nearing $1100 – February 23, 2010

by Bullion Prices Staff on February 23, 2010

A stronger dollar drove precious metal prices lower on Tuesday. The greenback was propelled higher by weaker consumer confidence numbers, as reported by the U.S. Conference Board. Commodities fell as the dollar hit an 8-month high against a basket of six other world currencies.

In New York precious metal prices, April gold declined $9.90, or 0.9%, to $1,103.20 an ounce. It ranged from $1,099.60 to $1,121.70. March silver fell 33.4 cents, or 2.1%, to close at $15.888 an ounce. April platinum lost $21.60, or 1.5%, to end at $1,510.30 an ounce.

"Markets are likely to remain in limbo ahead of Bernanke’s testimony, as investors are nervous of further fiscal tightening following last week’s hike in the discount rate," James Moore, an analyst at in London, said in a report that was cited on Bloomberg.

In PM London bullion prices, gold was fixed at $1,107.00 an ounce, declining $8.25. Silver fell 34 cents to $16.100 an ounce. Platinum was settled at $1,518.00 for a fall of $17.00.

"The US dollar continued to rise, as risk aversion remained the predominant theme among market players," wrote Jon Nadler, senior analyst at Kitco Metals, Inc. "Rally attempts in gold over recent session have been truncated by the rising perception that gold investment demand continues to be lackluster."

New York crude-oil for March delivery declined $1.45, or 1.8%, to end at $78.86 a barrel. Gold, considered a hedge during times of high inflation and economic uncertainty, tends to follow oil and move opposite to the U.S. dollar. A rising greenback makes dollar-denominated commodities, like bullion, more expensive for holders of other world currencies.

In bullion coin news, an interesting sampling of 2010 Gold Eagle coin values shows that the highest graded coins sell for the most in the secondary market. Eagles falling into the MS70 grade have had an average realized price on eBay of $1,340 an ounce between their release on January 19, 2010, to February 19, 2010. In news about the US Mint, Director Moy talks about coins in a recent forum that was open to the public. Coin production, mintage forecasts 2010 coin designs and other US coinage details were discussed.

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