Gold retreated from the highest level since November as a five-day advance damped physical demand and U.S. Federal Reserve Chairman Janet Yellen pledged to continue with a gradual tapering of stimulus.
Bullion for immediate delivery lost as much as 0.6 percent to $1,284.15 an ounce, and was at $1,286.78 at 3:12 p.m. in Singapore. Prices climbed to $1,293.93 yesterday, the highest level since Nov. 14, capping a five-day, 2.9 percent rally that was the longest since August.
Gold is up 6.7 percent this year on haven demand from a rout in emerging markets even as U.S. policy makers have twice since December cut monthly bond-buying by $10 billion. In her first testimony to Congress as head of the Fed, Yellen said stimulus will be cut in measured steps, while reiterating that purchases aren’t on a preset course. Volumes for Shanghai’s benchmark spot contract fell yesterday from a nine-month high.
“Physical buyers are very sensitive to price changes so it’s no surprise if demand slows,” said Lv Jie, an analyst at Cinda Futures Co., a unit of one of four funds in China created to buy bad debt from banks. “ETF flows appear to be stabilizing and bullion investors seem to interpret Yellen’s comments as neutral for the market.”
Assets in the SPDR Gold Trust, the biggest exchange-traded product backed by bullion, rose yesterday after holdings were unchanged for four days. The holdings are little changed this year after contracting 41 percent in 2013.
Gold for April delivery decreased as much as 0.5 percent to $1,283.90 an ounce on the Comex in New York and traded at $1,286.90, halting a five-day advance that was the longest winning run for a most-active contract since August 2012.
Silver lost 0.3 percent to $20.1685 an ounce, snapping an eight-day advance that was the longest rally since August. Palladium added 0.3 percent to $720.85 an ounce, set for a sixth day of gains in the longest winning streak since July.
Platinum rose 0.2 percent to $1,391.25 an ounce, climbing for a fourth day. Talks to end a strike over pay that has crippled production at the world’s largest platinum mines have been delayed to Feb. 13 from yesterday after the companies requested more time.-Bloomberg
