Gold may fall as rally to record high spurs selling
Gold may decline in London as a rally to a record this week on debt concerns in the US and Europe prompts some investors to sell the metal.
By Bloomberg |
LONDON| SINGAPORE: Gold may decline in London as a rally to a record this week on debt concerns in the US and Europe prompts some investors to sell the metal. Gold climbed to a record $1,628.05 an ounce on July 27 and is up for the first month in three amid deadlock between US President Barack Obama and House Republicans over lifting the debt ceiling. Moody's Investors Service said it may cut Spain's credit rating.
Gold held in exchange-traded products rose to an alltime high Thursday. “While I'm still medium- and long-term bullish, I maintain that gold has rallied too far, too fast,” Jim Pogoda, an investor in Summit, New Jersey, and a former precious-metals trader for Mitsubishi International Corp., said in an e-mail .
“I can't imagine that US will default, or get downgraded , and that the risk premium associated with it in the price at the moment will come out in coming days.” Immediate-delivery gold fell $1.15, or 0.1%, to $1,614.80 an ounce by 11:19 am in London on Friday. Prices are up 0.8% this week and 7.6% this month. Gold for December delivery was up 0.1% at $1,617.30 on the Comex in New York after reaching a record $1,631.20 on July 27.
Bullion was little changed at $1,613.75 an ounce in the morning “fixing” in London, used by some mining companies to sell output, from $1,613.50 at Thursday's afternoon fixing. Gold is up 14% this year, heading for an 11th straight annual gain, the longest winning streak since at least 1920 in London . The MSCI All-Country World Index of equities gained 1.6% in 2011, the Standard & Poor's GSCI Index of 24 commodities is up 9.3% and Treasuries returned 3.4%, according to a Bank of America Merrill Lynch index.
US House Speaker John Boehner, falling short of the votes within his own party needed to increase the nation's debt limit after a night of one-on-one appeals to members, canceled a vote on a plan that Senate leaders pledged to defeat. The Obama administration will brief the public no earlier than after financial markets close Friday on priorities for paying the nation's bills if the $14.3 trillion debt ceiling isn't raised, a Democratic Party official said.
Gold held in exchange-traded products rose to an alltime high Thursday. “While I'm still medium- and long-term bullish, I maintain that gold has rallied too far, too fast,” Jim Pogoda, an investor in Summit, New Jersey, and a former precious-metals trader for Mitsubishi International Corp., said in an e-mail .
“I can't imagine that US will default, or get downgraded , and that the risk premium associated with it in the price at the moment will come out in coming days.” Immediate-delivery gold fell $1.15, or 0.1%, to $1,614.80 an ounce by 11:19 am in London on Friday. Prices are up 0.8% this week and 7.6% this month. Gold for December delivery was up 0.1% at $1,617.30 on the Comex in New York after reaching a record $1,631.20 on July 27.
Bullion was little changed at $1,613.75 an ounce in the morning “fixing” in London, used by some mining companies to sell output, from $1,613.50 at Thursday's afternoon fixing. Gold is up 14% this year, heading for an 11th straight annual gain, the longest winning streak since at least 1920 in London . The MSCI All-Country World Index of equities gained 1.6% in 2011, the Standard & Poor's GSCI Index of 24 commodities is up 9.3% and Treasuries returned 3.4%, according to a Bank of America Merrill Lynch index.
US House Speaker John Boehner, falling short of the votes within his own party needed to increase the nation's debt limit after a night of one-on-one appeals to members, canceled a vote on a plan that Senate leaders pledged to defeat. The Obama administration will brief the public no earlier than after financial markets close Friday on priorities for paying the nation's bills if the $14.3 trillion debt ceiling isn't raised, a Democratic Party official said.
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