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Gold Prices Slip on Greece Debt Deal, U.S. Data (Update 1)

Updated from 11:40 a.m. EST with settlement prices

NEW YORK ( TheStreet) -- Gold prices sank Tuesday as a slew of positive U.S. economic data and a bailout agreement with Greece weighed on the yellow metal.

Gold for December delivery lost $7.30 to settle at $1,742.30 an ounce at the Comex division of the New York Mercantile Exchange. The gold price traded as high as $1,751.90 and as low as $1,742.50 an ounce, while the spot price was losing $6.10, according to Kitco's gold index.

"Consumer confidence was up slightly ... combined with the Greece deal ... that is a nice coordinated effort that does move the ball a little bit further towards a final resolution of Greece," said Jeffrey Wright, managing director of metals and mining at Global Hunter Securities.

The Census Bureau reported Tuesday that durable goods orders were unchanged in October, while the S&P Case-Shiller 20-city home price index gained 3% year over year in September.

The Conference Board's consumer confidence report for November on Tuesday showed an increase to 73.7, which was better than the 73 index level a consensus of economists expected.

Improving U.S. data could suggest overall economic health with the prospect of strengthening growth in the near term, which would make gold -- typically a safe-haven investment to hedge against inflation, a weakening dollar or flagging financial conditions -- less of an appealing play.

The greatly anticipated action by the eurozone to reach an agreement on a bailout deal for Greece finally came to fruition as finance ministers concurred that steps to make that country's debt more manageable included cutting interest rates on bailout loans and extending the deadlines on loan repayments and Greek bond buybacks.

The news of Greece's bailout, though, didn't seem to be enough to calm investors' nerves as the euro slumped against the U.S. dollar.

The euro was dipping to $1.2934 against the greenback from the prior day's close at $1.2972. The U.S. dollar index was jumping 0.35% to $80.40.

A strengthening U.S. dollar usually works against a rise in the price of gold.

Silver prices for December delivery shed 16 cents to close at $33.98 an ounce. Platinum for January delivery added $7.50 to hit $1,618.50 an ounce.

Negotiations on the so-called fiscal cliff in the U.S. were expected to ramp up this week as legislators returned to Capitol Hill. Though President Obama and House and Senate leadership haven't offered any details for a potential agreement, the tone continues to leave analysts optimistic.
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