adminSINGAPORE. – Gold fell to its lowest level in four weeks yesterday, extending a sell-off into a fourth straight session as investors feared the Federal Reserve would raise US interest rates this year. The technical picture for gold has deteriorated, with traders warning of further price drops. Physical demand and investor flows have also not supported the metal. Spot gold had eased 0,2 percent to $1 139,93 an ounce by 3.48am GMT, after earlier dropping to $1 134,60, its lowest since October 5.
Gold had rallied last month on speculation that the softness in the global economy could prompt the Fed to delay the rate hike to next year. But the US central bank’s hawkish tone last week triggered a sell-off in bullion. Technical selling and liquidation of long positions were sending prices lower, HSBC analyst James Steel said.
“Gold probably needs moderately better emerging market import demand if it is to sustain a rally. In the near term, the market also needs a respite from investor liquidations if prices are to stabilise,” Mr Steel said.
Asian gold demand saw some uptick towards the end of last week, as lower prices attracted buyers. But local premiums remained largely unmoved, a sign that demand had not picked up in a significant way, dealers said. Demand outside Asia also remained soft. US Mint American Eagle gold coin sales slumped 73 percent in October. – Reuters.
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