Gold was steady in New York as investors weighed additional U.S. stimulus and mounting concerns that lawmakers haven’t moved closer to resolving the country’s budget impasse.
Prices dropped for the third-straight week even after the Federal Reserve said Dec. 12 it will start buying $45 billion a month of Treasuries, adding to $40 billion a month of existing mortgage-debt purchases. U.S. President Barack Obama and House Speaker John Boehner met yesterday to discuss averting more than $600 billion of spending cuts and tax increases before a year-end deadline, with no public announcement of progress.
“The Fed’s decision to stick with its expansionary monetary policy and even to expand its bond-purchasing program was unable to help gold back on its feet,” Commerzbank AG analysts including Carsten Fritsch said in a report.
Gold futures for February delivery rose 20 cents to settle at $1,697 an ounce at 1:41 p.m. on the Comex in New York. The metal was down 0.5 percent this week.
Prices are heading for a 12th consecutive annual gain as central banks from the U.S. to China pledge more steps to spur economic growth. Holdings in gold-backed exchange-traded products rose 3.9 metric tons to a record 2,630 tons yesterday, data compiled by Bloomberg show.
The so-called fiscal cliff of U.S. spending cuts and tax increases is scheduled to begin in January. Obama and congressional Democrats have said they won’t discuss spending cuts unless Republicans agree to higher tax rates for top earners. Republicans are insisting on reductions to entitlement programs such as Medicare.
Silver futures for March delivery fell 0.2 percent to $32.299 an ounce, extending the weekly decline to 2.5 percent.
On the New York Mercantile Exchange, platinum futures for January delivery climbed 0.1 percent to $1,614.50 an ounce. It added 0.5 percent this week.
Palladium futures for March delivery increased 1.5 percent to $702.05 an ounce. The metal gained 0.6 percent for the week.