Gold capped its biggest weekly drop in more than five months on concern that U.S. lawmakers may fail to reach a settlement in talks aimed at avoiding self-imposed tax increases and budget cuts known as the fiscal cliff.
Republican House Speaker John Boehner told reporters that budget talks were in a stalemate and the Obama administration’s offer yesterday wasn’t a “serious” proposal. The president said today he expects prolonged negotiations. Gold tumbled 2.2 percent this week, the most since June 22.
“Fiscal-cliff concern is keeping investors on the sidelines,” Frank McGhee, the head dealer at Integrated Brokerage Services LLC in Chicago, said in a telephone interview.
Gold futures for February delivery slid 1 percent to settle at $1,712.70 an ounce at 1:43 p.m. on the Comex in New York. Prices retreated 0.4 percent this month, the second straight loss.
Silver futures for March delivery fell 3.3 percent to $33.279 an ounce on the Comex. Prices dropped 2.7 percent this week, the most since Nov. 2.
On the New York Mercantile Exchange, platinum futures for January delivery slipped 0.9 percent to $1,604.60 an ounce, extending the weekly loss to 0.8 percent.
Palladium futures for March delivery gained 0.1 percent to $688.20 an ounce. Prices rose 3.1 percent this week, the fifth straight gain.