The Sunday Mail
GOLD fell toward an eight-month low as US data that beat estimates reinforced expectations for higher borrowing costs, boosting the dollar. Platinum sank to the lowest since June 2013, while palladium and silver dropped.
Gold for immediate delivery fell as much as 0,6 percent to US$1 209,37 an ounce, and traded at US$1 209,80 by midday in Singapore on Thursday, according to Bloomberg generic pricing. The metal declined to US$1 208,40 on September 22, the lowest price since January 2 and within 0,6 percent of wiping out the year’s gain.
Bullion is headed for the first quarterly loss this year as the Bloomberg Dollar Spot Index rose to a four-year high.
A fortnight ago Federal Reserve officials raised interest rate forecasts even as they maintained a pledge to keep rates low for a considerable time to aid the recovery. Wednesday data showed sales of new US homes surged in August and Goldman Sachs Group Inc repeated a forecast for gold to decline this year.
“The dollar will continue to drive direction,” said Lv Jie, an analyst at Cinda Futures Co in Hangzhou, China.
“There is some pick-up in physical interest but not enough to stem losses.”
Goldman Sachs’s Jeffrey Currie maintained the bank’s forecast for gold to drop to US$1 050 by the end of 2014.
Support to prices from political uncertainty in Ukraine and the Middle East earlier this year has faded, and inflation is expected to be subdued, said Currie, head of commodities research.
Gold for December delivery fell 0,8 percent to US$1 209,50 an ounce on the Comex in New York.
Prices dropped to US$1 208,80 on September 22, the lowest since January.
Holdings in the SPDR Gold Trust, the biggest bullion-backed exchange-traded fund, were unchanged Wednesday after dropping to 773,45 metric tonnes on September 23, the least since December 2008.
Central banks from Russia to Ukraine and Turkey increased gold reserves in August as Mexico and Czech Republic trimmed holdings, International Monetary Fund data showed.
The Kyrgyz Republic, Kazakhstan and Azerbaijan also showed higher gold reserves for the month, figures on the IMF website showed.
Platinum for immediate delivery lost as much as 1,3 percent to US$1 300,75 an ounce, dropping for a second day and extending a retreat from a 10-month high of US$1 519,68 in July.
The metal, which traded at US$1 302,38, is heading for the first quarterly loss this year. Platinum slid 5 percent this year even as demand for the metal used in pollution-control devices in cars improved, and supplies from South Africa, the world’s largest producer, were curbed by labour disputes.
Holdings in exchange-traded products backed by the metal are at a four-month low after expanding to a record in July.
Credit Suisse Group AG expects prices to be “muted” in the near-term as the market is oversupplied, according to a report last week.
The platinum market is not in a “structural deficit,” just a strike-induced one, Goldman Sachs Group Inc said in a July report. Spot palladium decreased 1,2 percent to US$806,75 an ounce. Silver retreated 1,5 percent to US$17,4381 an ounce, after declining to US$17,3491 on September 22, the lowest since July 2010. — Bloomberg.
