Investing.com - Gold held on to losses in pre-holiday trade on Wednesday, as investors digested a flurry of U.S. data before the Christmas break.
Gold for February delivery on the Comex division of the New York Mercantile Exchange shed $4.40 cents, or 0.41%, to trade at $1,069.70 a troy ounce during U.S. morning hours. A day earlier, gold dipped $6.50, or 0.6%, snapping a two-day rally.
The U.S. Commerce Department said that total durable goods orders, which include transportation items, were unchanged last month, compared to forecasts for a decline of 0.6%. Core durable goods orders, excluding volatile transportation items, fell by 0.1% in November, disappointing expectations for a gain of 0.1%.
Orders for core capital goods, a key barometer of private-sector business investment, decreased 0.4% last month, worse than expectations for a decline of 0.1%, while shipments of core capital goods, a category used to calculate quarterly economic growth, decreased 0.5% in November, confounding forecasts for a gain of 0.5%.
A separate report showed that personal spending inched up 0.3% last month, meeting forecasts. Personal income, meanwhile, rose 0.3%, above forecasts for a 0.2% gain.
The core PCE price index rose 0.1% last month. On an annualized rate, the core PCE price index increased 1.3%. The Federal Reserve uses core PCE as a tool to help determine whether to raise or lower interest rates, with the aim of keeping inflation at a rate of 2% or below.
Trading volumes are expected to remain light as many traders already closed books before the end of the year, reducing liquidity in the market and increasing volatility. U.S. markets close early Thursday, Christmas Eve, and are shut Friday for Christmas Day.
The dollar index, which measures the greenback’s strength against a trade-weighted basket of six major currencies, was up 0.25% at 98.47.
Gold is on track to post an annual decline of 10% in 2015, the third yearly loss in a row, as speculation over the timing of a Fed rate hike dominated market sentiment for most of the year. Rising interest rates historically have been bad news for gold, which can't compete with the higher interest rates offered by other assets.