London 29/10/2010 - Gold fell again in Europe on Friday morning on light selling after the US dollar rebounded against the euro, with rangebound trade likely to continue over the coming hours and sessions ahead of multiple central bank meetings. Spot gold fell $5.70 to $1,336.80/1,337.60 per ounce after a one-percent rebound from lows in the previous session on the dollar’s retreat. “Thursday’s gains, while taking the metal through some trendline resistance, were in the larger picture well contained within the range of the past two weeks or so,” a trader said. “Range trading remains the theme ahead of next week’s action that will see four central bank meetings, non-farm payrolls data and mid-term elections in the US,” he added. The dollar was holding around 1.3827 against the euro, close to its session highs, ahead of a string of economic data that may shape views on the Federal Reserve meeting next week. “The FOMC meeting on November 3 and the potential announcement of quantitative easing remains the key focus,” broker Credit Suisse said. “Sentiment is likely to remain shaky in the run-up to this event risk.” But the softer tone in commodity prices - base metals fell some three percent today - may be temporary, with a period of consolidation and sideways trading needed at the start of the month, some traders said. For now the focus will be on forthcoming data, which will probably be viewed as an indicator of just how large QE2, the renewed Federal Reserve money-printing programme, will be. The continues to drop ever-bigger hints that it will unleash an extensive quantitative easing programme worth between $80 billion and $100 billion spread out over several months in an attempt to stimulate the besieged US economy. Meanwhile, European stocks fell back after a steady start that was due to positive quarterly results by British Airways. Today's data-heavy US schedule kicks of with third-quarter GDP, with the employment cost index, Chicago PMI and Michigan sentiment figures all due out as well. GDP growth is expected to come in at two percent on an annualised basis. In other news, long-term investors also appeared to be taking profits - the world’s largest gold exchange-traded fund (ETF), the SPDR Gold Trust, reported outflows of some five tonnes, which would bring total outflows to almost 12 tonnes in October. Yesterday, the World Gold Council (WGC) reported a fall in investment demand in the third quarter, when ETF activity slowed to a total of 28.3 tonnes from the high levels of the previous three-month period, when investors bought 234.6 tonnes of metal. “This is probably due to the high gold prices in this period, which have evidently had an impact on investors,” broker Commerzbank said. Among other precious metals, silver fell 15 cents to $23.80/23.85 per ounce, platinum was down $6 at $1,684/1,688 and palladium fell $3 to $627/632. “Over the next few days, the platinum group metals look poised to outperform,” Credit Suisse said. The South African National Union of Mineworkers said that more workers were joining a strike at domestic platinum mines, with wage talks remaining difficult and more production outages likely. “This should be particularly supportive for platinum,” Credit Suisse added.

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