Gold prices declined

June 21, 2012 ஆக்கம் sknlakshmi

Gold continue to decline as the U.S. dollar strengthened and on weak Chinese manufacturing data. The traders seem to factor in the measure taken by Fed to support the faltering economic growth. Data released by HSBC earlier in the day showed Chinese manufacturing activity continued to weaken in June from levels seen in the previous month also weighed on sentiment.

The drop came as the ICE dollar index, which measures the greenback's performance against a basket of six major currencies, inched up. Fed officials signaled heightened worries on the economy, extended a program shifting their holdings toward longer-term securities through the end of the year.

After a two-day meeting ended Wednesday, the Federal Open Market Committee said it will extend a program to replace its purchases of shorter-term securities with longer-tenor bonds in a bid to lower interest rates at the far end of the yield-curve. But it gave a subdued economic outlook and failed to suggest more monetary easing was in the offing.