US durable goods orders, new home sales drive metals price moves

New economic data from the US sent precious metals prices higher and base metals prices lower Wednesday as investors worried that the global economy is slowing down and looked for safe places to put their cash.

December gold added $7.90 to $1,241.30 per troy ounce in New York trade as US durable goods orders were up much less than had been anticipated and as new home sales in the US dropped to a new low.

The US Commerce Department reported that US durable goods orders, orders for good expected to last for at least three years, were up by just 0.3 percent in July, against an expected rise of 2.7 percent.

Most of those gains came on advance of 13.1 percent in orders for transportation equipment; with those orders removed from the equation, orders were down 3.8 percent for the month.

The Commerce Department also reported that new home sales in the US dropped to their lowest on record, falling 12.4 percent against an expected advance, with the biggest decline coming in the West, where sales fell 25.4 percent.

In addition to the gains for gold, September silver added 65 cents to $ 19.03 per troy ounce and December contracts gained 64 cents to $19.07 per troy ounce.

While the new data helped gold prices rise, the same figures drove copper prices lower, with September contracts dropping 3 cents to $3.21 per pound in New York trade, while three-month contracts in London were down $36 to $7,101 per tonne.

Nearly half of the copper used in the United States goes into construction projects and much of the rest of it is used in manufacturing, so that the new data on durable goods orders and home sales did not hold out much hope that demand will rise significantly, at least in the short term.

Other base metals followed copper lower on the London Metal Exchange.