Gold gave back some of yesterday’s strong gains as Citigroup predicted 2013 may not see the bumper price rises predicted by some. Spot gold eased US$3.9 to US$1730.5 as the downgrade to France’s credit rating also knocked the euro against the US dollar. Traders said sentiment was affected by Citigroup’s prediction, which suggested that gold will peak at US$1,800 in the first three months of 2013, well below some of the more bullish preidctions of US$2,000 recently from company bosses. Citigroup added that investors appear to be losing faith in the bull story for gold with net long managed money positions on Comex 33% lower since the start of October ETF uptake has been an important indicator of investor sentiment toward gold, it said, with physical gold holdings up 237.85 tons in the year-to-date, but much of that uptake was focused in August and September on pre QE3 expectations. Since the beginning of October positive flows have stalled, with redemptions seen in November. Among central banks demand is slow and even the Russian Central appears to have reversed its buying policy, suggests the broker. Citi expects silver to average $31 next year, down from this year's $31.30, and to further decline to $26.50 in 2014 as supply slowly catches up with demand. Spot silver was flat today at US$33.09, while platinum shed US$1 to US$1,572.

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