Gold ends lower on stronger US dollar

Gold futures on the COMEX division of the New York Mercantile Exchange finished lower on Wednesday, pressured by a stronger U.S. dollar and a surge in new U.S. homes sales last month to the highest in more than five years. The most active gold contract for August delivery fell 15 dollars, or 1.12 percent, to settle at 1,319.7 dollars per ounce. Tracking the most-active contracts, the losses marked the largest one-day percentage and dollar drops since July 5, according to FactSet. Market analysts believed gold fell as sales of new U.S. homes in June rose to a five-year high, a sign of improved economic growth that may prompt the U.S. Federal Reserve to slow financial stimulus measures, which pressures the precious metal. Statistics released by U.S. Department of Commerce show that sales of new homes in the U.S. surged in June to an annual rate of 497,000, the highest since May 2008. Analysts believe that every new economic data could add to speculations over the timing of the stimulus tapering. Furthermore, a rise in the U.S. dollar also weighed on dollar- denominated gold. Similarly, silver for September delivery dropped 23.4 cents, or 1.16 percent, to close at 20.020 dollars per ounce.