Gold futures drifted lower on Thursday and snapped a three-day winning streak, as traders switched over to riskier assets such as equities thanks to positive economic data.
The Federal Reserve, which cut interest rates by 25 basis points on Wednesday, did not provide any hint about future rate cuts and just reiterated that it would act as appropriate to support economic expansion.
The dollar index declined to 98.20 and was last seen hovering around 98.25, down 0.3% from previous close.
Gold futures for December ended down $9.60, or about 0.6%, at $1,506.20 an ounce.
On Wednesday, gold futures for December ended up $2.40, or 0.2%, at $1,515.80 an ounce.
Silver futures for December ended down $0.035, at $17.884 an ounce, while Copper futures for December settled at $2.6085 per pound, down $0.0045 from previous close.
On Wednesday, Fed Chair Jerome Powell described the U.S. economic outlook as “favorable,” and shot down media speculation about the yield curve signaling a recession on the horizon.
“We are adjusting monetary policy in a more accommodated direction to try to support what is in fact a favorable outlook,” he said.
Elsewhere, the Bank of Japan kept its monetary policy on hold, but reiterated its willingness to pursue additional easing measures to support the economy.
The Bank of England today held its interest rate and the quantitative easing programme amid the heightened uncertainty as the October 31 deadline for the UK’s exit from the European Union looms. The bank warned that the global slowdown and a no-deal Brexit would hurt the economy severely.
Investors also looked ahead to a potential cooling of U.S.-China trade tensions, as the two sides gear up for talks.
In economic news, a report from the National Association of Realtors said existing home sales in the U.S. surged up by 1.3% to an annual rate of 5.49 million in August after spiking by 2.5% to a rate of 5.42 million in July.
The continued increase came as a surprise to economists, who had expected existing home sales to pull back by about 0.4%.
The Labor Department also released a report showing a smaller than expected rebound in weekly jobless claims, while a report from the Philadelphia Federal Reserve showed growth in regional manufacturing activity slowed less than expected.
The material has been provided by InstaForex Company – www.instaforex.com