Gold futures fell for the second straight day as gains in the U.S. economy boosted speculation that the Federal Reserve will raise interest rates soon.
Retail sales in November jumped the most in eight months, and the number of Americans filing for unemployment benefits fell to a three-week low, government reports showed today. The dollar and the Standard & Poor’s 500 Index of stocks rose, eroding the appeal of gold as an alternative investment. Yesterday, the metal dropped 0.2 percent.
On Dec. 9, gold reached a six-week high as global equities tumbled, increasing demand for a haven. Swings in oil prices have boosted volatility in the metal as investors weigh muted inflation. Fed officials will meet next week to discuss the timing of the first benchmark rate increase since 2006.
“Retail sales and jobless claims were good, and all of that points to Fed tightening sooner or later,” George Gero, a precious-metal strategist at RBC Capital Markets in New York, said in a telephone interview. “Every time you mention tightening, gold sells off.”
Gold futures for February delivery fell 0.9 percent to $1,218.80 an ounce at 10:18 a.m. on the Comex in New York. Two days ago, the price reached $1,239, the highest since Oct. 23.
Yesterday, holdings in the SPDR Gold Trust, the world’s largest exchange-traded product backed by the metal, rose the most since mid-July after global equities dropped.
Silver futures for March delivery fell 0.8 percent to $17.045 an ounce. The price climbed in the previous three days, the longest rally since Oct. 15.