Shrinking Trade Deficit Sends Gold Down

by Christopher Freeburn | August 6, 2013 4:30 pm

Shrinking Trade Deficit Sends Gold Down

PreciousMetalsRecap Shrinking Trade Deficit Sends Gold Down[1]A report that the U.S. trade deficit in June fell to its lowest level in more than three years ignited speculation that the U.S. economy outpaced growth estimates during the second quarter, dampening gold’s appeal as a safe haven. The metal slid in Tuesday trading.

According to data released by the Commerce Department, the trade deficit dropped 22.4% to $34.2 billion in June. That marked its lowest level since October 2009. It also surprised economists who had forecast the trade deficit to decline more modestly to $43.5 billion in June. The lower-than-expected trade deficit suggested a stronger U.S. economy, raising the chances that the Federal Reserve will taper its monthly bond-buying before the end of this year.

Gold futures for December delivery sank 1.5% to $1,282.50 per ounce Tuesday, according to CME Group[2]. Gold traded as high as $1,306.40 and as low as $1,278.10. Gold bullion closed in London at $1,285, according to BullionVault[3].

Silver futures for December delivery slid 1% $19.57 per ounce. Tuesday’s high for silver was $19.82, while the low was $19.51.

Gold and silver funds declined in Tuesday trading.

Gold and silver mining ETFs moved sharply lower during the day.

Gold mining shares retreated on Tuesday.

Silver mining shares also pulled back during the day.

As of this writing, Christopher Freeburn did not hold a position in any of the aforementioned securities. Adrian Ash of BullionVault[23] contributed to this report.

Endnotes:
  1. [Image]: http://investorplace.com/wp-content/uploads/2011/10/PreciousMetalsRecap.gif
  2. CME Group: http://www.cmegroup.com
  3. BullionVault: http://www.bullionvault.com
  4. GLD: http://studio-5.financialcontent.com/investplace/quote?Symbol=GLD
  5. IAU: http://studio-5.financialcontent.com/investplace/quote?Symbol=IAU
  6. SLV: http://studio-5.financialcontent.com/investplace/quote?Symbol=SLV
  7. GDX: http://studio-5.financialcontent.com/investplace/quote?Symbol=GDX
  8. GDXJ: http://studio-5.financialcontent.com/investplace/quote?Symbol=GDXJ
  9. SIL: http://studio-5.financialcontent.com/investplace/quote?Symbol=SIL
  10. AEM: http://studio-5.financialcontent.com/investplace/quote?Symbol=AEM
  11. ABX: http://studio-5.financialcontent.com/investplace/quote?Symbol=ABX
  12. EGO: http://studio-5.financialcontent.com/investplace/quote?Symbol=EGO
  13. GG: http://studio-5.financialcontent.com/investplace/quote?Symbol=GG
  14. KGC: http://studio-5.financialcontent.com/investplace/quote?Symbol=KGC
  15. NEM: http://studio-5.financialcontent.com/investplace/quote?Symbol=NEM
  16. NG: http://studio-5.financialcontent.com/investplace/quote?Symbol=NG
  17. AUY: http://studio-5.financialcontent.com/investplace/quote?Symbol=AUY
  18. CDE: http://studio-5.financialcontent.com/investplace/quote?Symbol=CDE
  19. HL: http://studio-5.financialcontent.com/investplace/quote?Symbol=HL
  20. PAAS: http://studio-5.financialcontent.com/investplace/quote?Symbol=PAAS
  21. SLW: http://studio-5.financialcontent.com/investplace/quote?Symbol=SLW
  22. SSRI: http://studio-5.financialcontent.com/investplace/quote?Symbol=SSRI
  23. BullionVault: http://www.bullionvault.com/

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