Newspaper article THE JOURNAL RECORD

...But Gold Hits Four-Year Low

Newspaper article THE JOURNAL RECORD

...But Gold Hits Four-Year Low

Article excerpt

Gold futures price sank to four-year lows Wednesday on the New York Mercantile Exchange as investment interest in the metal waned against a strong world economy and little sign of inflation in the United States.

Silver and other precious metals also retreated sharply. On other commodity markets, soybean futures fell sharply a third day on prospects for ample supplies. Coffee futures also fell.

Heavy Asian selling Wednesday of physical supplies added pressure to a gold futures market that has been pressured for months by concern European central banks will sell a portion of their gold stocks. Many of those countries hope to use proceeds from a sale to address budget deficits to meet fiscal requirements for a common European Union currency. Furthering pressuring prices has been the robust American economy amid little inflationary pressures, which has made holding gold as a hedge against rising prices less attractive. The Federal Reserve decided Wednesday to leave interest rates unchanged, a further sign inflationary pressures are being held at bay. Analyst Ted Arnold at Merrill Lynch said there is too much gold on the market, and that will lead to continued lower prices. "There is no fundamental justification for it to move higher, and we see that spot gold could see $250 (an ounce) within the next two years," Arnold said. Silver futures followed gold lower. Platinum and palladium futures retreated as Russia prepares to ship the metals to Japanese car, computer and jewelry manufacturers for the first time since December. Gold for August delivery fell $2.80 to $332.30 an ounce; September silver fell 3.30 cents to $4.64 1/2 an ounce. July platinum fell $3.70 to $417.20 an ounce; September palladium fell $1.80 to $174.50 an ounce. Soybean futures prices fell to new two-year lows in the contract month representing the fall harvest on the Chicago Board of Trade amid concern low inventories could build as buyers await an expected record crop. …

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