Gold Prices End Down for Second Year in a Row; Metal Weighed Down by Expectations of Higher U.S. Interest Rates, Tame Global Inflation
Gold prices ended down for second year in a row, weighed down by investors' expectations of higher U.S. interest rates and tame inflation around the world.</br></br>Gold for February delivery, the most actively traded contract, closed down $16.30, at $1,184.10 a troy ounce on the Comex division of the New York Mercantile Exchange. Prices fell 1.5% for the year.</br></br>A stronger dollar weighed on gold Wednesday, making the metal more expensive for buyers holding other currencies. The WSJ Dollar Index, which gauges the dollar against other major currencies, was recently up 0.4%, at 83.00.</br></br>"The way things stand, I would be looking to sell into any rallies from here," said Bob Haberkorn, a broker at RJO Futures. "Gold will continue to be weak because of rate expectations."</br></br>An improving U.S. economy has sparked expectations that the Federal Reserve will raise interest rates in 2015, a move that would hurt gold, which struggles to compete with yield-bearing investments in times of tighter monetary policy. At the same time, inflation has been elusive in the world's major economies, reducing gold's attractiveness as a hedge against rising consumer prices.