Gold fell the most in a week on bets that the Federal Reserve may refrain from more U.S. stimulus measures, while the dollar’s rebound eroded the appeal of the metal as an alternative investment.
Data from ADP Employer Services showed today that U.S. companies added more workers than forecast in June, which may ease concern that the labor market is deteriorating. The euro tumbled to a four-week low against the dollar after the European Central Bank cut its benchmark interest rate to a record.
“There is now less impetus for the policy makers to expand the balance sheet,” Bart Melek, the Toronto-based head of commodity strategy at TD Securities Inc., said in a telephone interview. “The dollar’s strength is not helping matters.”
Gold futures for August delivery fell 0.8 percent to settle at $1,609.40 an ounce at 1:40 p.m. on the Comex in New York, the biggest drop for a most-active contract since June 28.
In the second quarter, the metal slumped 4 percent as the dollar gained 3.3 percent against a basket of major currencies.
Silver futures for September delivery fell 2.1 percent to $27.672 an ounce in New York.
On the New York Mercantile Exchange, platinum futures for October delivery dropped 0.9 percent to $1,477.70 an ounce, ending a three-session rally. Palladium futures for September delivery slipped 2.2 percent to $585.75 an ounce.
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