Gold futures fell the most in six weeks on speculation that the Federal Reserve will taper U.S. monetary stimulus as the economy gains, curbing demand for the precious metal as a store of value.
Today, the Fed will announce the third $10 billion cut in bond purchases, according to a Bloomberg survey. Factory output rose in February by the most in six months and housing starts were little changed, data showed this week. Gold climbed to a six-month high on March 17 as tensions escalated between Russia and Ukraine.
“The focus is on the Fed today, and good economic numbers are not helping the market either,” George Gero, a vice president and precious-metal strategist in New York at RBC Capital Markets, said in a telephone interview. “Lack of news from Crimea has lessened haven needs.”
Gold futures for April delivery fell 1.4 percent to $1,340.20 at 10:41 a.m. on the Comex in New York. A close at that price would mark the biggest decline for a most-active contract since Jan. 30. The metal headed for the third straight drop, the longest slump in 10 weeks.
Trading was 17 percent above the average for the past 100 days for this time, data compiled by Bloomberg showed.
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