Investing.com - Gold futures stayed lower on Tuesday, after data showed U.S. consumer confidence improved unexpectedly in September, boosting optimism over the health of the economy and supporting the case for a rate hike this year.
Gold for December delivery on the Comex division of the New York Mercantile Exchange inched down $1.20, or 0.11%, to trade at $1,130.50 a troy ounce during U.S. morning hours.
The Conference Board, a market research group, said Tuesday its index of consumer confidence rose to 103.0 this month from a reading of 101.3 in August. Analysts expected the index to fall to 96.1 in September.
The upbeat data should strengthen expectations of a Federal Reserve interest rate hike in the coming months.
A day earlier, gold tumbled $13.90, or 1.21%, after New York Federal Reserve Bank President William Dudley said that the Fed remains on track for a rate hike this year and could move as soon as the upcoming meeting in October.
The comments came after Fed Chair Janet Yellen said last Thursday that the U.S. central bank was likely to raise interest rates in 2015.
The timing of a Fed rate hike has been a constant source of debate in the markets in recent months. The U.S. central bank has two more scheduled policy meetings before the end of the year, in late October and mid-December.
Most economists believe the Fed will begin raising rates in December after holding policy steady earlier this month due to concerns over the global economy, particularly China.
Gold fell to a five-and-a-half year low of $1,072.30 on July 24 amid speculation the Fed will raise interest rates for the first time since 2006 at some point this year.
Elsewhere in metals trading, copper for December delivery on the Comex division of the New York Mercantile Exchange sank to an intraday low of $2.225 a pound, a level not seen since July 2009, before recovering to trade at $2.254 during morning hours in New York, up 0.2 cents, or 0.1%.
On Monday, copper lost 3.2 cents, or 1.4%, after data showed profits earned by Chinese industrial companies in August fell 8.8% from a year earlier.
The gloomy data underlined concerns over the health of the world's second largest economy, adding to fears over slackening demand for the industrial metal.
Copper prices have been under heavy selling pressure in recent weeks as fears of a China-led global economic slowdown spooked traders and rattled sentiment.
The Asian nation is the world’s largest copper consumer, accounting for almost 40% of world consumption last year.