Gold swung between gains and losses in New York as investors weighed signs physical demand may rise at lower prices against the outlook for less U.S. stimulus.
The U.S. House passed a federal budget plan yesterday, boosting speculation the measure will support the economy and make it easier for the Federal Reserve to start to reduce stimulus. Volumes for bullion of 99.99 percent purity on the Shanghai Gold Exchange, the benchmark spot contract, rose today to the highest since Nov. 28.
Gold is set for the first annual drop in 13 years as some investors lost faith in the metal as a store of value and on speculation the Fed will pare monetary stimulus as the economy improves. Bullion futures touched $1,210.10 an ounce on Dec. 6, the lowest since July 5, after data showed U.S. payrolls gained more than forecast in November.
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