Gold finished slightly higher in Wednesday's trading as a bleak outlook from Intel (INTC) led some traders to the safety investment. The gain erased slight losses from yesterday's session.
May-dated gold futures settled at $893.50 per ounce, up $1.50 for the session. Earlier, gold touched as low as $886.20.
The dollar remained under pressure versus the resurgent sterling Wednesday as and continued its run of choppy dealing versus the euro. The buck firmed up slightly against the yen. Gold often moves opposite the dollar because of its hedge appeal.
The Labor Department said its consumer price index edged down 0.1 percent in March following a 0.4 percent increase in February. The modest decrease came as a somewhat of a surprise to economists, who had expected prices to edge up 0.1 percent.
Excluding food and energy prices, the core consumer price index rose 0.2 percent for the third consecutive month. Economists had been expecting a 0.1 percent increase in core prices.
Earlier, the Mortgage Bankers Association revealed that its market index of mortgage application volume fell 11 percent on a seasonally adjusted basis for the week of April 10th. The Market Composite Index was 1113.2 compared to 1250.6 in the previous week.
Later in the morning, a Federal Reserve report showed that industrial production fell by 1.5 percent in March, matching the decrease that was reported for the previous month. Economists had been expecting a somewhat more modest decrease of about 0.9 percent.
In the afternoon, traders learned overall economic activity has contracted further or remained weak, according to the Federal Reserve's Beige Book report released on Wednesday. However, five of the 12 Fed districts noted a moderation in the pace of decline.
In corporate news, Intel said it was not providing a revenue outlook for the second quarter at this time due to economic uncertainty and limited visibility. The world's biggest chipmaker reported earnings per share of $0.11 in the first quarter, compared to $0.25 a year ago.
Gold prices dropped to $892 per ounce, down $3.80 for the session, giving back some of its gains from Monday.
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