Gold traded near $1,300 an ounce as investors assessed the outlook for the pace of stimulus reduction by the U.S. Federal Reserve. Holdings in the largest bullion-backed exchange traded fund were unchanged.
Bullion for immediate delivery traded at $1,299.39 an ounce at 10:51 a.m. in Singapore from $1,297.28 yesterday, when the metal fell 0.5 percent, according to Bloomberg generic pricing. Gold rose 8.1 percent this year, rallying from the worst annual drop in more than three decades, as tension in Ukraine boosted haven demand.
The Fed will release tomorrow minutes of its March 18-19 meeting at which it cut monthly bond-buying by $10 billion for a third straight time, leaving purchases at $55 billion. U.S. jobs data last week trailed estimates as Fed Chair Janet Yellen said that slack in labor markets showed accommodative policies will still be needed for some time.
“Gold remains under pressure as the U.S. economy continues to show signs of gradual improvement and tension slowly eases in Ukraine,” said Lv Jie, a Hangzhou-based analyst at Cinda Futures Co., a unit of one of four funds in China created to buy bad debt from banks. “Prices just below $1,300 aren’t attractive enough to physical buyers. Gold will stay in a tight range as investors await the Fed minutes.”
Morgan Stanley said gold is its least preferred metal, forecasting lower prices for the next four quarters, on the outlook for rising U.S. interest rates and low inflation expectations, analyst Joel Crane wrote in a report today.
Gold for June delivery traded at $1,299.60 an ounce on the Comex in New York from $1,298.30 yesterday. Assets in the SPDR Gold Trust were unchanged yesterday after declining to 809.18 metric tons on April 4, the least since March 7.
Silver for immediate delivery rose 0.2 percent to $19.918 an ounce. Platinum traded at $1,427.50 an ounce from $1,428.94 yesterday, when prices slid 1.5 percent, the most since Jan. 30. Palladium increased 0.3 percent to $768.40 an ounce, after sinking 3.1 percent yesterday, the most since June 26.
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