Gold Ends Lower For Ninth Straight Session

(RTTNews) - Gold futures slipped for a ninth straight session to end at a 5-1/2-year low on Tuesday, after having plunged over two percent yesterday. Investors continued to stay away from the precious metal amid speculation the U.S. Federal Reserve will react to the improving economy and raise interest rates this fall.

Although the dollar trended lower against some major currencies, there were no major economic releases for the day as directional cue for the precious metal.

Seen as a safe haven in time of economic instability, there was little support for the precious metal with an eventual resolution to a major global economic crisis with resolution to the Greek financial crisis for the time being. As a result, Athens repaid some EUR 4.2 billion to the European Central Bank on Monday, as part of dues that was delayed.

The deal between Iran and the West over Tehran's nuclear program cleared some of shimmering tensions in the Middle East, which also has been a negative for gold. The progress in normalization of U.S. - Cuba diplomatic relations continued with the opening of embassies in Havana and Washington also contributed to the waning safe haven status of gold.

Gold for August delivery, the most actively traded contract, fell $3.30 or 0.3 percent, to settle at $1,103.50 an ounce, on the Comex division of the New York Mercantile Exchange on Tuesday.

Gold for August delivery scaled an intraday high of $1,108.80 and a low of $1,095.90 an ounce.

On Monday, gold prices plummeted $25.10 or 2.2 percent, to settle at $1,106.80 an ounce, on waning safe haven appeal and the dollar trending lower against some select currencies.

Holdings of SPDR Gold Trust, the world's largest gold-backed exchange-traded fund, edged down to 694.46 tons on Tuesday, from its previous close of 707.88 tons.

The dollar index, which tracks the U.S. unit against six major currencies, traded at 97.26 on Tuesday, down from its previous close of 98.05 in late North American trade on Monday. The dollar scaled a high of 98.15 intraday and a low of 97.14.

The euro trended higher against the dollar at $1.0952 on Tuesday, as compared to its previous close of $1.0827 in North American trade late Monday. The euro scaled a high of $1.0969 intraday and a low of $1.0812.

On the economic front, U.K. public sector net borrowing decreased in June from last year, the Office for National Statistics said Tuesday. Excluding public sector banks, PSNB dropped GBP 0.8 billion to GBP 9.4 billion in June. It was equivalent to 0.5 percent of gross domestic product.

Foreign direct investment in China grew 0.7 percent in June from a year ago to $14.6 billion, the Chinese Commerce Ministry reported Tuesday. In the first six months, FDI climbed 8.3 percent from last year to $68.4 billion. Investment in manufacturing, however, dropped 8.4 percent.

The leading index for Japan, which measures the future economic activity, dropped as estimated in May, final figures from the Cabinet Office showed Tuesday. The index dropped to 106.2 in May from 106.4 in the previous month. This was in line with the preliminary data. In March, the score was 105.2.