Gold futures fell the most in six weeks as signs of a recovery in the U.S. economy curbed demand for the precious metal as an alternative asset. Silver dropped to the lowest since mid-March.
Sales of previously owned homes jumped in March to the highest since September 2013, figures from the National Association of Realtors showed Wednesday. The dollar pared losses against a basket of 10 currencies, while gold dropped to a one-week low. The metal fell 2.5 percent in March as the greenback climbed for the ninth straight month.
“The housing data was very positive, and the chatter about a rate hike in June or September is getting louder” for U.S. borrowing costs, Phil Streible, a senior market strategist at RJO Futures in Chicago, said in a telephone interview.
Gold futures for June delivery fell 1.3 percent to settle at $1,186.90 an ounce at 1:50 p.m. on the Comex in New York, the biggest drop for a most-active contract since March 6. Earlier, the metal touched $1,185, the lowest since April 14.
Estimated trading for the contract was 261,646 contracts with the highest volume shortly after the housing data was related at 10 a.m.
U.S. monetary policy will remain accommodative once the central bank lifts interest rates, likely in 2015, New York Federal Reserve President William C. Dudley said in a speech Monday at the Bloomberg Americas Monetary Summit.
Silver futures for May delivery slumped 1.3 percent to $15.796 an ounce. Earlier, the price touched $15.655, the lowest since March 18. Aggregate trading was 72 percent above the 100-day average for this time, according to data compiled by Bloomberg.
Among 22 raw materials in the Bloomberg Commodity Index, only hogs posted a bigger drop than gold and silver. The broad gauge fell for the fourth straight session, the longest slump since March 17.
On the New York Mercantile Exchange, platinum futures for July delivery dropped 2 percent to $1,129.70 an ounce, the biggest decline since March 30. Earlier, the price touched $1,128.60, the lowest since March 31.
Palladium futures for June delivery fell 2.4 percent to $755.90 an ounce, the largest slump since March 27.
This year, gold has climbed 0.2 percent, while silver advanced 1.3 percent. Platinum has dropped 6.6 percent, and palladium declined 5.3 percent.