BLBG:Gold Poised to Decline Before Fed Policy Meeting; Silver Falls
Gold is poised to drop before the policy-setting Federal Open Market Committee meets from today amid signs that the U.S. economy is improving, reducing demand for bullion as an alternative investment. Silver declined.
Spot gold traded little changed at $1,726.20 an ounce at 10:09 a.m. in Singapore after falling as much as 0.2 percent to $1,725. Gold for December delivery was also little changed at $1,727 an ounce on the Comex in New York.
Bullion, up 10 percent this year, has erased gains made after the Federal Reserve announced a third round of debt-buying on Sept. 13. The FOMC meeting concludes tomorrow. Stimulus measures taken by central banks from Europe to China and Japan helped drive gold to an 11-month high of $1,796.05 on Oct. 5.
“The Fed has previously talked up its capacity to support the U.S. economy, but we are not expecting any signs of fresh stimulus,” Australia & New Zealand Banking Group Ltd. analysts led by Mark Pervan wrote in a note today. “The $1,725 level appears to be the critical level of support.”
Data this week may show consumer spending picked up in the third quarter while durable-goods orders rebounded last month from the biggest drop since January 2009, according to economists’ estimates before the reports. The jobless rate fell to 7.8 percent in September, the lowest since President Barack Obama took office in 2009, according to data released Oct. 5.
Spot gold of 99.99 percent purity was little changed at 347.70 yuan a gram ($1,728.89 an ounce) on the Shanghai Gold Exchange, the country’s largest cash bullion market. Volumes for the benchmark contract were 4,251 kilograms yesterday from 4,234 kilograms on Oct. 19.
Cash silver slid as much as 0.5 percent to $32.2675 an ounce, before trading at $32.4225. Spot Palladium lost 0.2 percent to $624 an ounce, dropping for a fourth day. Platinum was little changed at $1,610 an ounce after falling for the past three days.
To contact the reporter on this story: Glenys Sim in Singapore at gsim4@bloomberg.net
To contact the editor responsible for this story: James Poole at jpoole4@bloomberg.net
