Gold Ends Lower On Upbeat U.S. Data

(RTTNews) - Gold futures snapped a three-day gain to end lower Wednesday, as the dollar trended higher against a basket of major currencies after a report showed better-than-expected January new home sales in the U.S. with sales at its highest level in over five years. The news helped dispel some concerns that the U.S. economy had lost its growth momentum following a slew of disappointing data recently.

In economic news, a Commerce Department report on Wednesday showed new home sales to have rebounded unexpectedly in January, after reporting a notable drop in the previous month.

U.S. mortgage applications to buy a home fell last week to its lowest level in nearly two decades, according to the Mortgage Bankers Association.

Gold for April delivery, the most actively traded contract, shed $14.70 or 1.1 percent to close at $1,328.00 an ounce on the Comex division of the New York Mercantile Exchange on Wednesday.

Gold for April delivery scaled an intraday high of $1,345.60 and a low of $1,322.30 an ounce.

Holdings of SPDR Gold Trust, the world's largest gold-backed exchange-traded fund, edged up to 803.70 tons from 801.61 tons tons previously.

The dollar index, which tracks the U.S. unit against six major currencies, traded at 80.50 on Wednesday, up from its previous close of 80.14 late Tuesday in North American trade. The dollar scaled a high of 80.52 intraday and a low of 80.09.

The euro traded lower against the dollar at $1.3671 on Wednesday, as compared to its previous close of $1.3746 late Tuesday in North America. The euro scaled a high of $1.3760 intraday and a low of $1.3662.

In economic news, a Commerce Department report showed new home sales in the U.S. jumped 9.6 percent to a seasonally adjusted annual rate of 468,000 in January from an upwardly revised December rate of 427,000. Economists expected new home sales to drop to an annual rate of 400,000 from the 414,000 originally reported for the previous month. Sales was at its highest level since July 2008.

U.S. mortgage applications dropped last week to its lowest level since 2000, a report from the Mortgage Bankers Association showed. The MBA's seasonally adjusted index of mortgage application activity, which includes both refinancing and home purchase demand, fell 8.5 percent to 348.5 in the week ended February 21.

Germany's consumer confidence is set to improve to a seven-year high in March, reflecting upbeat income expectations amid stable labor market development, a closely watched survey from the market research group GfK showed Wednesday. The forward-looking consumer confidence index rose to 8.5 points from 8.3 points in February. The index was forecast to remain unchanged at February's original score of 8.2.