Gold set for biggest weekly loss in 2 months
Singapore, November 22, 2013
Gold was heading for its sharpest weekly drop in more than two months as strong US economic data and uncertainty over the timing of the rollback of the Federal Reserve's stimulus measures sent the metal to its lowest since early July.
Spot gold had risen slightly to $1,245.09 an ounce by 0249 GMT on Friday, after hitting a fresh four and a half month low of $1,236.29 the session before.
Gold and silver were both on track for a near 4-percent weekly drop.
"Some kind of price consolidation is possible as sentiment is quite mixed right now," said Mark To, head of research at Hong Kong's Wing Fung Financial Group.
He said that selling-pressure on the metal was not as strong as in the first half of the year due to assurances from some top Fed officials that stimulus would continue for longer.
But positive US data was hurting prices as it could bolster the case for curbing stimulus soon. The Fed's massive
bond-buying programme has burnished gold's appeal as a hedge against inflation.
The number of Americans filing new claims for jobless benefits fell sharply last week and a gauge of factory activity
hit an eight-month high in early November, hinting at some strength in the economy.
Uncertainty over the timing of the tapering has pushed investors to take money out of gold, causing the metal to drop 25 percent this year.
Janet Yellen - the likely next Fed chair - said last week that she would press forward with the bank's ultra-easy monetary policy until officials were confident a durable economic
recovery was in place that could sustain job creation.
Holdings of SPDR Gold Trust, the world's largest gold-backed exchange-traded fund, fell 3.6 tonnes to 856.71 tonnes on Thursday - their lowest since early 2009.
Outflows have totalled 450 tonnes this year. Physical demand picked up slightly due to the price drop but many buyers were still on the sidelines hoping for further declines, dealers said. - Reuters