Moneycontrol
Feb 21, 2013 09:07 AM IST | Source: Reuters

Gold languishes near seven-month low on Fed worries

Gold rebounded half a percent on Thursday, but remained near a seven-month low hit in the previous session on worries that the Federal Reserve may stop or slow its bond buying programme.

Gold languishes near seven-month low on Fed worries

Gold rebounded half a percent on Thursday, but remained near a seven-month low hit in the previous session on worries that the Federal Reserve may stop or slow its bond buying programme.


Gold fell together with other commodities, amid speculation that a hedge fund had been forced to liquidate positions across metals and oil markets.


Fundamentals


* Spot gold gained nearly half a percent to USD 1,569.26 an ounce by 0034 GMT, after falling to USD 1,558.24 in the previous session, its lowest since last July. It fell 2.6 percent on Wednesday, posting the biggest daily drop in a year.


* US gold fell 0.6 percent to USD 1,569.20.


* A number of Federal Reserve officials think the central bank might have to slow or stop buying bonds before seeing the pickup in hiring the program is designed to deliver, according to minutes of the central bank's policy meeting last month.


* India's trade ministry has recommended suspension of gold jewellery imports from Thailand, which are taxed at only 1 percent under a bilateral agreement while such imports from other countries are taxed at 10 percent.


* Anglo American Platinum (Amplats) said persistent labour unrest is jeopardising investment in South Africa and warned that talks with government and unions may not lead to a reduction in its planned job cuts.


* Holdings of SPDR Gold Trust, the world's largest gold-backed exchange-traded fund, slumped 1.57 percent from the previous session to 1,299.164 tonnes on Feb 20, the lowest in more than five months.


* Spot silver was nearly flat at USD 28.55, having fallen to a six-month low of USD 28.26 in the previous session.


* Spot platinum extended losses to the third straight session, down 0.7 percent to USD 1,632.24. Spot palladium fell half a percent to USD 733.97, after falling more than 3 percent in the previous session- its sharpest daily decline in nearly four months.



Market news


* The US dollar held firm on Thursday, having enjoyed its biggest one-day gain in seven months against a currency basket as commodities and US equities slid on rumours of a hedge fund in trouble.

* US stocks fell the most in three months and a key gauge of market volatility spiked on Wednesday after minutes from the US Federal Reserve's most recent meeting suggested the central bank may slow or stop buying bonds sooner than expected.

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