GOLD FALLS FURTHER

Gold traded within 40 cents of a four-year low after the Bank of Japan boosted stimulus and the Federal Reserve ended asset purchases, highlighting divergent central-bank policies and hurting bullion demand as the dollar climbed. Silver retreated to the lowest level since 2010.

“One printing press stops and another one cranks up,” Felicity Emmett, senior economist at Australia & New Zealand Banking Group Ltd., wrote in a note today. “Gold and silver prices slumped, both trading against the U.S. dollar strength.”

Gold capped the first back-to-back monthly decline of 2014 last week after dropping to $1,161.35, the lowest price since July 2010. While the Fed is now weighing the timing of interest-rate increases other central banks are taking steps to boost their economies, spurring the Bloomberg Dollar Spot Index to a four-year high. Societe Generale SA and Goldman Sachs Group Inc. are among banks expecting further losses for gold.

Bullion for immediate delivery fell as much as 1 percent to $1,161.75 an ounce, and was at $1,168.58 by 1:38 p.m. in Singapore, according to Bloomberg generic pricing. Silver lost as much as 2.4 percent to $15.7711 an ounce, the lowest price since February 2010. Both metals declined for a fourth day as the dollar rallied to a seven-year high against the yen.

Gold is heading for the first consecutive annual retreat since 2000 as prices are 2.8 percent lower this year after a 28 percent slump in 2013. Bullion fell last year as the Fed prepared to end bond-buying and holdings in exchange-traded products contracted.

“The differentiation in monetary policies only serves to support the dollar, which will make it very difficult for gold,” said Hou Jun, a Shenzhen-based strategist at CITIC Futures Co., a unit of China’s biggest listed brokerage.

Gold for December delivery lost as much as 0.9 percent to $1,161 an ounce on the Comex and traded at $1,168. Futures tumbled to $1,160.50 on Oct. 31, the lowest level since July 2010 after the BOJ’s surprise move to expand its monetary base to revive growth and inflation.

The net-long position in futures and options fell for the first week in three in the period ended Oct. 28, U.S. government data showed. Assets in the SPDR Gold Trust were unchanged on Oct. 31 after shrinking on Oct. 30 to the lowest since 2008.

The chances of bullion dropping to $1,000 are rising as cheaper energy means lower inflation, said Michael Haigh, SocGen’s head of commodities research. His counterpart at Goldman, Jeffrey Currie, expects prices to drop to $1,050 by the end of year. Both correctly forecast gold’s 2013 rout.

The price drop triggered losses in related equities. Newcrest Mining Ltd., Australia’s biggest producer, sank as much as 8.7 percent in Sydney after losing 4.5 percent on Oct. 31. The 40-company Standard & Poor’s/TSX Global Gold Sector Index lost 3.9 percent on Oct. 31.

Silver for immediate delivery traded 1.4 percent lower at $15.9386 an ounce, after posting a fourth monthly decline in October for the worst run since June 2013. The price dropped 18 percent this year after losing 36 percent in 2013.

Spot platinum decreased 0.5 percent to $1,230.50 an ounce, dropping for a fourth day to extend four months of losses. Palladium climbed 0.3 percent to $795.04 an ounce after a monthly increase in October.-Bloomberg