Gold declined for a second day, after reaching a record last week, as a strengthening U.S. dollar eases the demand for the metal as an alternative investment.
Precious metal for immediate delivery fell by 0.6 percent to $ 1,360.75 an ounce at 12:02 Melbourne time. The metal reached a record $ 1,387.35 on Oct. 14 as the dollar fell on speculation the Federal Reserve will have more incentives amid low inflation and an unemployment rate near 10 percent take.
“For the moment, we are ready for more meaningful data and other rhetoric from the Fed,” Darren Heathcote, head of trading at Investec Bank (Australia) Ltd., said today by telephone from Sydney. “Gold is the top, but you are bound to get some profit-taking,” he said.
Builders in the U.S. probably fewer homes started in September, while production rose for the seventh month, evidence of uneven growth, economists said reports this week. Fed Chairman Ben S. Bernanke said Oct. 15 that the bank can purchase assets to expand, while “non-conventional policies are the costs and limitations.
Gold for December delivery on the Comex in New York fell 0.8 percent to $ 1,361 an ounce. Futures have advanced 24 percent this year and reached a record $ 1,388.10 an ounce on October 14.
The dollar rose 0.2 percent against a basket of six currencies, get for half days. The dollar traded at $ 1.3924 per euro from $ 1.3977 on Oct. 15, when the previously reached the weakest level since January. Bullion usually moves in the opposite direction of the U.S. currency.
Profits Forecast
Still, bullion can get this week, as investors seek an alternative currencies, a Bloomberg survey last week found. Fifteen of 19 traders, investors and analysts surveyed, or 79 percent, said the metal, three forecast lower tariffs and a neutral.
Silver fell 2.1 percent to $ 23.8237 an ounce at 11:55 Melbourne time after reaching $ 24.92 on October 14 the highest level for 30 years.
The metal is between $ 20.50 and $ 25.50 trade for the rest of the year, Philip Klapwijk chairman of London-based research company GFMS Ltd. said Oct. 16.
“Our position is probably a silver top now almost, and that more downside in the short term than on his head, he said.”But we remain bullish on the long term.”
Platinum fell 0.8 percent to $ 1,682 per ounce, while palladium dropped 1.4 percent to $ 581.75 an ounce after reaching a nine-year high of $ 605.13 last week.
source:bloomberg
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