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Gold edges lower for sixth session on Fed stimulus worries

Source : REUTERS
Last Updated: Mon, Nov 04, 2013 03:35 hrs
Gold bars are displayed at Mitsubishi Materials Corporation in Tokyo

Gold eased for a sixth straight session on Monday to trade near two-week lows as renewed uncertainty over when the U.S. Federal Reserve will scale back its stimulus measures weighed on sentiment.

FUNDAMENTALS

Spot gold fell 0.1 percent to $1,313.54 an ounce by 0014 GMT, after posting a near 3 percent weekly drop. It fell to a low of $1,305.69 on Friday - its lowest since October 17.

A top Federal Reserve official said on Friday the U.S. labour market has recovered enough in the last 14 months to allow the central bank to reduce its bond-buying stimulus.

Another official said inflation has to be higher before the Fed decides to scale back.

The Fed's $85 billion monthly bond purchases have burnished gold's appeal as a hedge against inflation, boosting prices, but signs that the bank is nearing a tapering of the purchases have hurt prices this year.

The U.S. Mint's American Eagle gold coin sales rose to a two-year high on Friday, lifting 2013 sales above the previous year's total and reflecting the consistently strong demand for physical bullion coins among retail investors.

Hedge funds and money managers broadly raised bullish bets in futures and options of U.S. gold, silver and copper for the week ended October 22, a report by the Commodity Futures Trading Commission showed on Friday.

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MARKET NEWS

Asian markets started the week on a sluggish note on Monday, while the euro languished at two-week lows.


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