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US MIDDAY: gold falls

Gold prices eased early on Tuesday, extending the previous session's 1 percent drop, as global equities rebounded from their lowest in over a month and emerging markets stabilised after three days of intense selling. Moves were muted, however, ahead of the start of a two-day meeting by the US Federal Reserve, which is expected to continue tightening monetary policy.

Policymakers will almost certainly make a $10 billion cut to the Fed's $75 billion monthly bond-buying programme, analysts said. Expectations that the programme would be cut were a major factor in gold's 28 percent price crash last year. Spot gold was down 0.4 percent at $1,251.50 an ounce at 1543 GMT, while US gold futures for February delivery were down $11.60 an ounce at $1,251.80. The metal hit a 10-week high of $1,278.01 in Asian trading hours on Monday.

"We are looking more and more at the relationship between the major international stock markets and gold. That seems to be what's shaping the movement of prices," Peter Fertig, a consultant at Quantitative Commodity Research, said. Investors have been shaken this week by a huge sell-off in so-called risk assets due to jitters about the withdrawal of US monetary stimulus, slowing Chinese growth and country-specific political tensions.

Traders say demand for physical bullion from number one gold consumer China is also likely to wind down for the Lunar New Year holiday later this week. "At the moment (the rally) seems like it has run out of steam," Heraeus trader Alexander Zumpfe said. Premiums for 99.99 percent purity gold on the SGE slipped to $7 on Tuesday from $10 in the previous session.

Data from the International Monetary Fund showed on Tuesday that Kazakhstan lifted its gold reserves by 2.39 tonnes in December, while Belarus, Ukraine and Azerbaijan all also added to reserves. Among other precious metals, spot platinum was up 0.1 percent at $1,407.50 an ounce, recovering from the previous session's three-week low. Government-brokered talks between South Africa's AMCU union and the world's top three platinum producers ended on Monday with no breakthrough in efforts to end a strike, which has hit half of global output of the precious metal.

"The strike in the South African platinum mining industry is now into its sixth day, though the platinum price is failing to profit," Commerzbank said in a note. "On the contrary, it has actually shed nearly 3 percent since the strike began." Silver was down 0.8 percent at $19.52 an ounce, while palladium was down 1 percent at $713 an ounce.

Copyright Reuters, 2014



 



 
Index Closing Chg%
Arrow DJIA 16,461.32 0.92
Arrow Nasdaq 4,382.85 0.83
Arrow S&P 1,927.11 0.73
Arrow FTSE 6,399.73 0.43
Arrow DAX 8,940.14 0.60
Arrow CAC-40 4,105.09 0.58
Arrow Nikkei 15,195.77 2.64
Arrow H.Seng 23,403.97 1.37
Arrow Sensex 26,787.23 0.80





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Annual2013/14
Foreign Debt $61.805bn
Per Cap Income $1,386
GDP Growth 4.14%
Average CPI 8.6%
MonthlyAugust
Trade Balance $-2.807 bln
Exports $1.911 bln
Imports $4.718 bln
WeeklyOctober 20, 2014
Reserves $13.436 bln