Gold prices declined moderately today, dropping at the same time below $ 1,200 per ounce, which was due to the appreciation of the US currency.

The dollar rose 0.7 percent against a basket of major currencies, supported by comments from Fed Chairman Vice Stanley Fischer and the Federal Reserve Bank of New York, William Dudley. Both said that lower oil prices are generally very favorable for US economic growth. Dudley also said that the US central bank is likely to carry out first rate hike next summer. In his speech, he explained that the pace of interest rate hikes will be equally determined by the situation in the economy and how the financial conditions will respond to changes in the Fed's policy

Experts note that the prices of precious metals are likely to remain reduced and tend to decline further in the near term amid signs of strengthening US economy, which could cause the Fed to raise interest rates sooner and faster than previously predicted. Expectations of growth rates on loans put pressure on gold as a precious metal with difficulty competing with the yield of interest-earning assets at higher rates.

"The market has been too much short positions, but the growth seems excessive. I think the gold market will remain volatile until the end of the year "- said a trader for precious metals in Hong Kong. - In the near future direction of the market of gold depends on the dollar and oil. To support the growth of prices is also necessary demand in the physical market. "

Margins in China on Tuesday declined to less than $ 1 per ounce, and earlier in the week in China gold traded below the indicative price.

Little impact on the course of trading also has the fact that India last week unexpectedly eased restrictions on gold imports. But traders do not expect an immediate increase in purchases, since the country has sufficient reserves of precious metals.

Market participants also drew attention to the news from China. The Chinese government is likely to set the bar in GDP growth next year at 7%. In this regard, the Chinese authorities can go on a series of stimulus measures, including the introduction of tax incentives, and 1-2 times lower reserve requirements to trigger economic growth in the country.

Cost of January futures for gold on the COMEX today fell to 1199.00 dollars per ounce.