BLBG:Gold Holds Near One-Month Low Amid Record Holdings, Dollar Gains
Gold traded little changed after declining to a one-month low as investors’ boosted holdings in exchange-traded products to the highest ever, countering the impact of a stronger dollar.
Spot gold was at $1,693 an ounce at 12:27 p.m. in Singapore after fluctuating between gains and losses. The metal fell to $1,684.93 yesterday, the least expensive since Nov. 6, as the dollar rallied on speculation that U.S. lawmakers will reach a budget agreement. Holdings in ETPs climbed to 2,627.59 metric tons yesterday, data compiled by Bloomberg show.
A few dozen Republicans joined a bipartisan call to break an impasse between President Barack Obama and House Speaker John Boehner to avoid spending cuts and tax increases in January, known as the fiscal cliff. The Dollar Index, which tracks the greenback against six major partners, halted its longest slump in more than a year yesterday and gained 0.2 percent today.
“Markets are being held hostage by progress on the fiscal cliff in the U.S.,” said Feng Liang, an analyst at GF Futures Co., a unit of the nation’s third-biggest listed brokerage. “There are still bargain hunters for gold below $1,700.”
Gold will probably peak in 2013 and keep declining the following year as U.S. growth accelerates, Goldman Sachs Group Inc. said yesterday. Bullion will be at $1,825 in three months, $1,805 in six months and $1,800 in a year, it said, lowering its three-month forecast from $1,840 and its six- and 12-month outlooks from $1,940, Goldman said in a report.
Gold for February delivery was little changed at $1,693.60 an ounce on the Comex in New York. The most-active contract slipped to $1,686 yesterday, also the lowest level since Nov. 6.
Cash silver fell for a third day, losing 0.3 percent to $32.7725 an ounce. Spot platinum dropped 0.3 percent to $1,579 an ounce after touching a two-week low of $1,571.15 yesterday. Palladium was little changed at $684.50 an ounce.
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
