Gold Caps Worst Start to a Year Since 1997 as Investment Ebbs

Gold fell in New York, capping the worst start to a year since 1997, on speculation that an improving economy will erode demand for the precious metal as an alternative investment.

Consumer spending in the U.S. rose more than forecast in December, ending the strongest quarter in more than four years, the Commerce Department said today. Holdings in exchange-traded products backed by bullion fell to 2,033.8 metric tons on Jan. 28, the lowest since June, according to data compiled by Bloomberg. Last year, gold rallied 30 percent, outperforming stocks and bonds.