London: Gold fell to the lowest price in six weeks in London as signs of recovery in the US boosted the case for the Federal Reserve to keep reducing stimulus and start to raise interest rates. Palladium declined. US orders for durable goods climbed a more-than-forecast 2.2% in February, reflecting the biggest gain in automobile demand in a year, data showed on Thursday. Fed chief Janet Yellen said on 19 March the central bank’s debt-buying programme may end this fall and the first increase in the benchmark rate may come six months after that. Gold climbed to a 6-month high earlier this month on demand for a haven. Russia’s annexation of Crimea sparked European and US sanctions and rekindled memories of the Cold War. US President Barack Obama said on Wednesday the US and its European allies stand united against Russian attempts to redraw Ukraine’s boundaries. There’s a lot of liquidations after investors built up bets on higher prices, Bernard Sin, head of currency and metal trading at bullion refiner MKS (Switzerland) SA in Geneva, said on Thursday by phone. Signs of US improvement would start beating gold. There’s no physical demand. Bullion for immediate delivery dropped 0.8% to $1,294.60 an ounce by 9:28 am in London. It reached $1,291.61, the lowest since 13 February, falling below the 200-day moving average. Gold for June delivery slipped 0.6% to $1,295.30 on the Comex in New York, where futures trading volume was more than double the average for the past 100 days for this time of day, data compiled by Bloomberg showed. Gold’s slump Bullion slipped 28% last year, the most since 1981. An accelerating US economy and higher Treasury yields and dollar will pressure prices this year, Georgette Boele, a commodities strategist at ABN Amro Group NV, wrote in a report on Wednesday. The bank predicts gold will drop to $1,100 an ounce at the end of the year. The main driver of gold at the moment fundamentally is the fact the US interest rates are pushing higher, said Steven Dooley, head of research at Forex Capital Trading Pty in Melbourne. The US and European Union have imposed financial sanctions on Russian and Ukrainian officials as well as associates of Russian President Vladimir Putin, leaving open the threat of broader sanctions targeting the Russian economy, including its energy and financial sectors. Silver for immediate delivery fell 0.5% to $19.6685 an ounce in London, after reaching a seven-week low of $19.5776. Platinum added 0.1% to $1,407.25 an ounce, after reaching $1,402.50 on Wednesday, the lowest since 13 February. Palladium slipped 2.2% to $763.50 an ounce. Prices climbed to $801.53 on 24 March, the highest since August 2011. Russia is the biggest supplier of palladium. South Africa is the next largest, and the top platinum producer. Workers have been on strike since 23 January at the South African operations of the world’s largest platinum miners. The companies will meet the state mediator for talks on 31 March. BLOOMBERG

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