Wednesday , August 23 2017
Home / Agri News / Gold falls in Europe

Gold falls in Europe




  • Gold fell on Tuesday as investors remained on the sidelines ahead of central banks meetings this week in Europe and the United States and support from the physical market softened while major buyer China was on holiday. Volumes are likely to thin on Wednesday when many European players are out for the Labour Day holiday as well, traders said. 

    Gold dropped 0.4 percent to $1,469.64 by 1437 GMT. It had gained nearly 1 percent on Monday on expectations the US Federal Reserve would keep the pace of its bond buying unchanged at $85 billion a month following weaker-than-expected US growth. US gold for June delivery was up 0.3 percent to$1,471.70 an ounce. 

    “The FOMC and ECB meetings are the focal events this week. But what we are seeing now is that price strength seen in the past few days is running out of steam, while investors are sitting on the fence ahead of the policy meetings,” Saxo Bank senior manager Ole Hansen said. Investors positioned for an interest rate cut by the European Central Bank and for the Fed’s Federal Open Market Committee to extend monetary stimulus measures, but traders said that the outcome for both was uncertain. Accommodative policy is generally seen as supportive for gold, because printing of money tends to be inflationary. 

    The Fed is currently buying longer-dated US Treasuries and mortgage-backed bonds every month and is expected to vote to keep doing so at the conclusion of a two-day policy-setting meeting on Wednesday. Gold prices sank to $1,321.35 on April 16, their lowest in more than two years, after a drop below $1,500 led to a further sell-off that stunned investors and prompted them to keep slashing holdings of exchange-traded funds. 

    The SPDR Gold Trust, the world’s largest gold-backed exchange-traded fund, said its holdings fell 0.22 percent to 1,080.64 tonnes on Monday, their lowest since September 2009. The fund’s holdings were set for a record monthly decline of 11.5 percent. 

    In the physical market, buying subsided as China, the world’s second-largest gold consumer after India, was on holiday until Thursday for Labour Day celebrations. Supply of gold bars, coins and nuggets in Asia remained tight, however, with premiums for gold bars in Hong Kong reaching their highest level since October 2011, up to $3 an ounce to spot London prices this week. 

    Silver fell 1.5 percent to $24.14 an ounce. Platinum gave up earlier gains to trade down 0.5 percent to $1,500.50 an ounce, having reached a two-week high of $1,522 on Monday. Palladium was down 0.2 percent to $694.97, having hit a two-week high of $700.72 earlier. On the supply side, third largest miner Lonmin shut down its Number Two furnace for 30-40 days following an undisclosed incident. Anglo American Platinum said it would next week reveal the outcome of talks with the government and unions about restructuring plans, in which it could cut up to 14,000 jobs and mothball two mines in South Africa. 

    Copyright Reuters, 2013

    About admin

    Check Also

    OVERCOMING A MENTAL ROADBLOCK FOR USING PLANT BREEDING SOFTWARE

    Report Issue: * Suggest Edit Copyright Infringment Claim Article Invalid Contents Broken Links Your Name: …

    Leave a Reply

    Be the First to Comment!

    Notify of
    avatar
    wpDiscuz