Gold retreated for the second straight day after retail sales in the U.S. were better than expected, reducing pressure on the Federal Reserve to announce measures to bolster the economy.
The 0.8 percent gain in sales, the first in four months, followed a 0.7 percent decrease in June that was weaker than first reported, Commerce Department figures showed today. Economists projected a 0.3 percent rise, according to a Bloomberg survey. Bullion gained 0.8 percent last week amid speculation that China, the U.S. and Europe may take more steps to boost economic growth, reviving demand for gold as an inflation hedge.
“The numbers are telling us that the U.S. economy is showing some signs of growth, and that lowers the chance of the Fed announcing any kind of stimulus measures in the near future,” Phil Streible, a senior commodity broker at R.J. O’Brien & Associates in Chicago, said in a telephone interview.
Gold futures for December delivery fell 0.6 percent to settle at $1,602.40 an ounce at 1:42 p.m. on the Comex in New York.
The metal surged 70 percent from the end of December 2008 to June 2011 as the Fed kept borrowing costs at a record low and bought $2.3 trillion of debt in two rounds of so-called quantitative easing.
Silver futures for September delivery slipped less than 0.1 percent to $27.763 an ounce in New York.
On the New York Mercantile Exchange, platinum futures for October delivery advanced 0.5 percent to $1,399.10 an ounce. Palladium futures for September delivery rose 0.6 percent to $578.40 an ounce.