NEW YORK (
Gold prices traded sideways on Wednesday as investors await European leaders' plans to handle the continent's economic troubles at a European Union summit meeting set to begin Thursday.
Gold for August delivery settled up $3.50 cents at $1,578.40 an ounce at the Comex division of the New York Mercantile Exchange. The gold price traded as high as $1,584.60 and as low as $1,563.10 an ounce, while the spot price was up $2.50, according to Kitco's gold index.
"We're trending sideways, a little bit, in anticipation of the EU summit tomorrow," said Will Rhind, CEO of ETF Securities U.S. "It's probably a safe bet to assume that the market will look for some kind of signals of progress, and I think any sign of progress will most likely be gold positive."
Silver prices settled down about 96 cents at $26.60 an ounce while the
U.S. dollar index was climbing 0.25% to $82.60.
Rhind said the market would like to see progress, but that expectations are low for such a result because of the failure of previous eurozone meetings to reach a conclusion that would make a material difference to solving the debt crisis.
Gold dipped Tuesday as more investors turned to the U.S. dollar as a safe-haven, largely due to April's Case-Shiller home-price index that showed improvement in home prices from March and thanks to a promising jump in new-home sales in May.
Important to note is that there are more gold buyers in Europe than in the United States.
"We have been seeing pretty aggressive buying of gold in European investors, and less so here in the U.S., and I think the European situation is markedly worse than it is in the U.S.," Rhind said.
Rhind said if U.S. economic indicators started to show signs of deterioration, then U.S. investors would use Europe as a guide for response.
Beyond the EU meeting, markets will begin to anticipate the monthly employment situation in the U.S. as the
has signaled the unemployment rate as a barometer for possible easing efforts.
Should unemployment continue to rise, it appears that the Fed would be more likely to move on a so-called QE3, the prospect of which would give gold a boost.
The majority of gold mining stocks were slightly lower Wednesday.
was dipping to $12.13, down 11 cents, or 0.88%, while
was falling to $39.98, down 55 cents, or 1.4%.
were lower by 0.5%, 0.7% and 0.4%, respectively.
-- Written by Joe Deaux in New York.