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Gold falls as investors mull fate of U.S. government shutdown

Published 10/04/2013, 02:02 PM
Updated 10/04/2013, 02:05 PM
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Investing.com - Gold prices moved lower on Friday as investors avoided the precious metal as a government shutdown dragged on with no end in sight and left markets without a key indicator due for release.

On the Comex division of the New York Mercantile Exchange, gold futures for December delivery traded at USD1,307.90 during U.S. afternoon hours, down 0.74%.

Gold prices hit a session low of USD1,306.40 a troy ounce and high of USD1,324.70 a troy ounce.

Gold futures were likely to find support at USD1,278.20 a troy ounce, Wednesday's low, and resistance at USD1,375.10, the high from Sept. 19.

The December contract settled down 0.23% at USD1,317.60 a troy ounce on Thursday.

An ongoing U.S. government shutdown prevented the Bureau of Labor Statistics from releasing the September jobs report on Friday.

Unemployment figures drive gold prices by giving markets indications as to when the Federal Reserve will begin unwinding stimulus measures, which have elevated prices for years by weakening the dollar.

Gold and the dollar tend to trade inversely with one another.

Elsewhere, many investors began to view the dollar as oversold and snapped up nicely priced greenback positions, which sent gold falling further.

Markets were also considering how the political deadlock will affect negotiations to raise the U.S. debt ceiling, which the U.S. Treasury Department has estimated will be reached by Oct. 17.

International Monetary Fund head Christine Lagarde said earlier that failure to raise the U.S. debt ceiling could hurt the global economy and warned U.S. growth could drop below 2% this year.

Elsewhere on the Comex, silver for December delivery was down 0.34% at USD21.712 a troy ounce, while copper for December delivery was up 1.01% and trading at USD3.302 a pound.











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