Investing.com - Gold futures added to losses on Wednesday, easing further off the previous session’s four-week high as concerns over the euro zone’s sovereign debt crisis continued to weigh on market sentiment.
On the Comex division of the New York Mercantile Exchange, gold futures for February delivery traded at USD1,645.25 a troy ounce during U.S. morning trade, dropping 0.63%.
It earlier fell by as much as 0.75% to trade at a session low USD1,643.25 a troy ounce. Prices rallied to a four-week high of USD1,667.95 on Tuesday.
Gold futures were likely to find support at USD1,631.95 a troy ounce, the low of January 16 and resistance at USD1,667.95, Tuesday’s high.
Market sentiment weakened as initial optimism over a report that the International Monetary Fund planned to boost its lending capacity to USD1 trillion faded.
Sources said the IMF needs to raise up to USD600 billion in new funds to lend to countries struggling with the fallout from the euro zone’s debt crisis. Initial reports called for the IMF seeking USD1 trillion.
Greece’s government was due to resume talks with its bond holders to discuss a voluntary write-down on Greece’s sovereign debt, after talks broke down on Friday, amid disagreements over how much money investors will lose by swapping their bonds.
Without the swap, debt-stricken Greece is unlikely to secure a second financial bailout, raising fears over a possible disorderly Greek default in March, when massive bond payments are due.
Adding to worries, overnight deposits at the European Central Bank rose to yet another record high, surpassing EUR500 billion for the second consecutive day, underscoring the unwillingness of European lenders to lend to each other.
Also Wednesday, ratings agency Fitch’s warned that Italy could face a two-notch downgrade. The ratings firm, which currently holds Italy at an A+ rating, said last week that there was a “significant” chance that Italy will have its credit rating cut by the end of January.
Meanwhile, Swiss lender Credit Suisse lowered its average gold price forecast for 2012 to USD1,755 per ounce from USD1,850, while maintaining its bullish view, saying the precious metal has recovered from its end-2011 corrections and is likely to return to its long-standing upward price trend.
Elsewhere on the Comex, silver for March delivery eased down 0.1% to trade at USD30.08 a troy ounce, while copper for March delivery dipped 0.1% to trade at USD3.727 a pound.
On the Comex division of the New York Mercantile Exchange, gold futures for February delivery traded at USD1,645.25 a troy ounce during U.S. morning trade, dropping 0.63%.
It earlier fell by as much as 0.75% to trade at a session low USD1,643.25 a troy ounce. Prices rallied to a four-week high of USD1,667.95 on Tuesday.
Gold futures were likely to find support at USD1,631.95 a troy ounce, the low of January 16 and resistance at USD1,667.95, Tuesday’s high.
Market sentiment weakened as initial optimism over a report that the International Monetary Fund planned to boost its lending capacity to USD1 trillion faded.
Sources said the IMF needs to raise up to USD600 billion in new funds to lend to countries struggling with the fallout from the euro zone’s debt crisis. Initial reports called for the IMF seeking USD1 trillion.
Greece’s government was due to resume talks with its bond holders to discuss a voluntary write-down on Greece’s sovereign debt, after talks broke down on Friday, amid disagreements over how much money investors will lose by swapping their bonds.
Without the swap, debt-stricken Greece is unlikely to secure a second financial bailout, raising fears over a possible disorderly Greek default in March, when massive bond payments are due.
Adding to worries, overnight deposits at the European Central Bank rose to yet another record high, surpassing EUR500 billion for the second consecutive day, underscoring the unwillingness of European lenders to lend to each other.
Also Wednesday, ratings agency Fitch’s warned that Italy could face a two-notch downgrade. The ratings firm, which currently holds Italy at an A+ rating, said last week that there was a “significant” chance that Italy will have its credit rating cut by the end of January.
Meanwhile, Swiss lender Credit Suisse lowered its average gold price forecast for 2012 to USD1,755 per ounce from USD1,850, while maintaining its bullish view, saying the precious metal has recovered from its end-2011 corrections and is likely to return to its long-standing upward price trend.
Elsewhere on the Comex, silver for March delivery eased down 0.1% to trade at USD30.08 a troy ounce, while copper for March delivery dipped 0.1% to trade at USD3.727 a pound.