Gold futures were seen trading lower on Friday, falling from a two-month high dragged lower by the Federal Reserve comments, growth forecast, tensions in Iraq and the weakening greenback.
Gold for immediate delivery slid 0.7% lower to $1,311.18 an ounce at the time of writing in London, after reaching $1,322.12, the highest since April 15. The yellow metal has climbed 9.1% this year after ending a twelve-year run bull run in 2013 on speculation the US central bank would trim its monetary stimulus.
Gold futures for August delivery slid 0.38% lower to $1,312.20 an ounce on the Comex in New York, while silver edged 0.21% lower at $20.610 an ounce, at the time of writing.
Fed Comments
On Thursday, gold prices advanced over 3% after Fed Policymakers said it projected that the US economy will expand between 2.1% and 2.3% this year, down from the previous forecast of 2.8% to 3% growth. The central bank also forecasted unemployment rate to come in between 6% to 6.1% at the year end. The Fed commented on the interest rates, suggesting it would remain low in the longer term.
Gold – Iraq
The ongoing tension in Iraq increased the bullion’s safe haven appeal, while the US President Barack Obama said he would send up to 300 US military advisers to the country to help with the conflict.
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Meanwhile an official report from China Gold Association stated that “private sector gold demand in China, which last year surpassed India to become the biggest consumer of the yellow metal, will be flat to slightly lower this year.”
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