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Updated from 12:30 p.m. EST with settlement prices
NEW YORK (
dipped Wednesday as investors reacted to a better-than-expected start to the earnings season which could suggest more improving indicators in the U.S. economy.
Gold for February delivery lost $6.70 to settle at $1,655.50 an ounce at the Comex division of the New York Mercantile Exchange. The
traded as high as $1,666 and as low as $1,653.70 an ounce, while the spot price was shedding $3.80, according to Kitco's gold index.
"The spreads are out in gold by 20 points in each segment, so that to me indicates that the market is expecting higher interest rates," said George Gero, precious metals strategist at RBC Wealth Management. "If you're looking at higher interest rates and no immediate inflation after the indexing was over yesterday, the sellers are back."
for March delivery were off 22 cents to close at $30.25 an ounce, while the
U.S. dollar index
was increasing 0.29% to $80.55.
Gold prices popped on Tuesday after a report emerged to show that gold imports by China from Hong Kong had nearly doubled in November from the previous month.
But the yellow metal has been stuck in a range that sees it jump one trading session and then come off in the next, in a process that has steadily repeated itself in recent weeks.
"Unless we have something that is unusual or new news, we're just looking at backing and filling; it's almost too cheap to sell, and it's almost too expensive to buy," Gero chuckled.
Aluminum products producer
Alcoa(AA - Get Report) posted late Tuesday better-than-expected revenue and an optimistic forecast for a slight increase in global demand growth for 2013. The report witnessed the New York-based company's stock pop about 2% in after hours trades after the news.
Following Alcoa's fiscal 2012 fourth-quarter earnings report, the major U.S. equity indices were higher Wednesday as
investors eyed the possibility of a surprise earnings season. All of this added to an already tepid gold market that has seen its confidence hit by an announcement by the
Federal Reserve that some of its members appeared more willing to end their quantitative easing programs
by or before the end of 2013, and as more U.S. economic sectors
report strong to steady improvement.