Gold fell to the lowest level in a week as assets in the largest exchange-traded product backed by the metal shrank to the smallest in more than six years. Silver, platinum and palladium decreased.
Bullion for immediate delivery lost as much as 1 percent to $1,185.82 an ounce, the lowest since Nov. 20, and traded at $1,194.72 by 3:36 p.m. in Singapore, extending yesterday’s 0.3 percent drop, according to Bloomberg generic pricing. Holdings in the SPDR Gold Trust fell yesterday for the first time in a week to 718.82 metric tons, the least since September 2008.
Gold rose to $1,207.93 on Nov. 21, the highest since Oct. 30, after China joined Japan and Europe in taking steps to spur growth by unexpectedly cutting interest rates. The metal is on course to snap two months of losses as central banks around the world ease monetary policy at a time when the Federal Reserve moves closer to an increase in borrowing costs.
“Gold prices have been struggling around $1,200 as investors prepare for the Thanksgiving holiday,” said Mark To, head of research at Wing Fung Financial Group, a Hong Kong-based trader and refiner. “The Swiss vote should be monitored even though the probability of ‘yes’ is low. When this supportive factor is removed, precious metals will be pressured lower.”
Switzerland holds a national referendum on November 30 that would require the central bank to hold at least 20 percent of its assets in gold, all of which have to be stored in the country, and never sell any. Polls last week showed a plurality of voters oppose the initiative, though a portion of them were still undecided.
via Bloomberg
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