Gold may decline for a third day alongside equities and other metals after China said it’s targeting slower growth this year, even as holdings in exchange- traded products backed expanded to a record.
Spot gold was little changed at $1,704.70 an ounce at 11:21 a.m. in Singapore, swinging between gains and losses. It fell 0.7 percent in the past two days as the dollar climbed 0.6 percent against a six-currency basket including the euro. Bullion assets in ETPs (.GLDTONS) advanced for a fourth day to 2,405.903 metric tons yesterday, data tracked by Bloomberg show.
Cash gold reached $1,790.75 on Feb. 29, the highest level since Nov. 14, before tumbling below $1,700 for the first time in more than a month the same day. It’s up 9 percent this year, extending an 11-year bull run. April-delivery gold was also little changed at $1,705.20 an ounce on the Comex in New York.
“Bullion fell after China, viewed by many as the engine of the global economy, cut its 2012 growth target to an eight-year low,” said Lynette Tan, investment analyst at Phillip Futures Ltd. “The precious metal could pull back further.”
China yesterday trimmed its growth forecast to 7.5 percent from an 8 percent goal in place since 2005. The Dollar Index was little changed today before a report forecast to show that’s Europe’s economy shrank in the fourth quarter, adding to signs that the debt crisis is slowing growth in the region.
“Sentiment in the market has been dented after gold tested and failed to reclaim the $1,800 level,” said Wang Honggang, a metals analyst at CIFCO Research Institute. “While the dollar’s recent strength is bearish for gold, the performance of the ETPs has been very encouraging.”
Hong Kong Shipments
Spot gold of 99.99 percent purity fell as much as 0.7 percent to 345.50 yuan a gram ($1,707.79 an ounce) on the Shanghai Gold Exchange, declining for a second day. Volumes for the benchmark contract were 5,071.60 kilograms (154,362 ounces) yesterday, up from 4,801.2 kilograms on March 2.
Buyers in mainland China purchased 32,948 kilograms of gold, excluding articles of goldsmiths’ wares, from Hong Kong in January, down from 38,650 kilograms in December, according to the Census and Statistics Department of the Hong Kong government yesterday. China doesn’t publish gold-trade data.
Silver, this year’s best-performing metal was little changed at $33.935 an ounce, after dropping to $33.535 yesterday, the lowest price since Feb. 21, Still, options traders are the most bullish in 16 months on an exchange-traded fund tracking the metal, betting it will rally as the global economy recovers.
Spot platinum dropped 0.4 percent to $1,655.75 an ounce, and palladium was unchanged at $705 an ounce.
To contact the editor responsible for this story: James Poole at firstname.lastname@example.org