Gold and silver futures, which had been trading higher earlier, now are paring those gains.
Meanwhile, popular precious metals ETFs have started flirting with negative territory.
Gold for August delivery, the most actively traded contract, is up 10 cents to $1,616.90 an ounce. More lightly traded December contracts are slightly down. The August futures had been trading up around $1,628.80 an ounce.
The SPDR Gold Trust (GLD) is off by 0.2% at $157.76 a share. It hit $158.56 a share early in Wednesday’s session and held near that level until falling 0.8% to set an intraday low about 30 minutes ago.
“Ironically, we’re seeing a bit of a move back into the dollar at the expense of gold,” said MF Global’s Edward Meir in an interview.
The metals strategist pointed out that even base metals, which have held up relatively well so far, are heading lower this morning. The PowerShares DB Base Metals ETF (DBB) has slid 0.7% so far.
Silver has been toying in the red. The iShares Silver Trust (SLV) is bouncing between slightly positive and negative, while September futures on the Comex are paring gains but remain up 11 cents at $40.81 an ounce. More thinly traded contracts are ahead by even smaller margins.
Besides reports that the U.S. House would delay a vote on a proposal to avoid a government default on its debt, the Commerce Department said that U.S. durable-goods orders fell 2.1% in June.
“Markets are starting to diverge instead of converge on the continuing stalemate over plans to raise the U.S. debt ceiling,” Meir noted. “And the major beneficiary seems to be the dollar, which doesn’t make much sense if we’re heading towards a credit default.”
The PowerShares U.S. Dollar Index (UUP) is now up 0.7%. It had been flat until late morning.
The Market Vectors Gold Miners ETF (GDX) is down 2.2% while the the Global X Silver Miners ETF (SIL) is falling by 2.1%. Read More
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