On Friday, gold (NYSEARCA:GLD) futures for February — the most active contract — edged 30 cents higher to close at $1,244.60 per ounce, while silver (NYSEARCA:SLV) futures declined 8 cents to finish at $19.90. Major exchange-traded funds, like the SPDR Gold Trust and iShares Silver Trust, also finished the day lower.
The price of gold suffered its worst weekly loss since September. Everything from bond-tapering fears to weak inflation numbers weighed on precious metals. The Federal Reserve’s latest minutes showed the central bank might reduce monthly bond purchases “in coming months” if economic data supports the move.
Meanwhile, producer prices declined for a second consecutive month in October. According to the U.S. Department of Labor, the seasonally-adjusted producer price index dipped 0.2 percent last month after falling 0.1 percent in September. Even one of the biggest goldbugs in the market is taking a step back. Billionaire John Paulson reportedly told clients at an annual meeting this week that he would not invest more money in his gold fund, according to Bloomberg.
Bloomberg explains that, “The hedge-fund manager, who has been betting that billions would rally as a hedge against inflation and as recently as last year told clients that gold was his best long-term bet, has lost 63 percent year-to-date in the PFR Gold Fund, said the person, who was briefed on the returns and asked not to be identified because the information is private.”
By the end of the trading day, shares of the SPDR Gold Trust (NYSEARCA:GLD) and iShares Silver Trust (NYSEARCA:SLV) both closed slightly in the red. Gold miner (NYSEARCA:GDX) Barrick Gold (NYSE:ABX) dropped 2.8 percent. However, shares of Endeavour Silver (NYSE:EXK) managed to edge about 0.10 percent higher.
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Disclosure: Long EXK, AG, HL, PHYS