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BookmarkInvesting.com – Gold prices rose in Asia on Thursday, kicking off trade in the region for the New Year with most markets closed yesterday and Japan shut today for a public holiday.
Futures were likely to find near-term support at USD1,181.90 a troy ounce, the earlier low, and resistance at USD1,213.90, the earlier high.
The Conference Board reported earlier that its index of U.S. consumer confidence improved to 78.1 in December from 72.0 in November, beating consensus forecasts for a 76.0 reading.
Also Tuesday, the Standard & Poor’s/Case-Shiller 20-city home price index rose at an annualized rate of 13.6% in October from a year earlier, the strongest pace since February of 2006 and above forecasts for an increase of 13.0%.
The data confirmed expectations for the Federal Reserve to continue winding down stimulus programs such as its USD75 billion in monthly bond purchases in 2014 and let the economy stand on its own feet.
Fed bond purchases tend to weaken the dollar by driving down interest rates to spur recovery, thus bolstering gold’s image as a hedge, though less monetary support can send gold falling.
The Fed has rolled out multiple rounds of bond purchase since the 2008 financial crisis, and the increasing likelihood that 2014 will see less and less monetary intervention has sent gold prices plunging in 2013.
Gold prices were finished 2013 contracting by about 29%, which would be the steepest decline for the yellow metal since 1981.
Investors had largely shrugged off industry data revealing that the Chicago purchasing managers’ index fell to a seasonally adjusted 59.1 this month from 63.0 in November.
Elsewhere on the Comex, silver futures for March delivery rose 0.80% to trade at USD19.525 a pound, while copper for March delivery was up 0.003% at 3.398.
