🐂 Not all bull runs are created equal. November’s AI picks include 5 stocks up +20% eachUnlock Stocks

Gold Slump Pauses, But Tapering Fears Persist

Published 12/23/2013, 04:31 AM
Updated 07/09/2023, 06:31 AM
GC
-
SI
-
PA
-
PL
-

Gold traded off $1,200 an ounce early Monday in a breather from sharp losses posted a week ago, as traders hardly digest the impact of Federal Reserve’s stimulus tapering.

The Fed's bond purchases are no longer bullion-friendly, and the last hectic drop in price was totally a sign the metal is no longer vulnerable to the central bank`s quantitative easing program (QE) as well. But, as the year nears to an end, traders are pondering whether gold has got further from a home being value amid lingering fears about the aftermath of the Fed's starting to scale back its stimulus plan as early as January - a move that was broadly anticipated by the consensus since mid-2013.

Spot gold was stuck around $1,202.27 an ounce as of 02:55 EST, compared with Friday's close at $1,203.24, and so far the sideway range continues between $1,199.86 and $1,204.61.

The Fed's decision Wednesday to start tapering its $85 billion bond buying program by $10 billion next month fueled more speculation the metal will lose further value if the US central bank reduces liquidity to diminish the risk of inflation.

Meanwhile, stimulus tapering worries continue to dominate sentiment. The yellow metal has now lost over a quarter of its value year to date, and on course for worst annual performance in over three decades. But can gold bounce back in 2014?

Although the reason to hold gold as a hedge against inflation don’t seems to be there, a slight turnaround in prices is likely with the new millennium, as gold demand typically peaks around ahead of the holiday season.

The thin trade remains on hold due to the Christmas holiday. Other precious spots were also trading in the same thin rangebound.

- Silver was little changed around $19.42 an ounce

- Platinum rose 0.35% to $1,337.75 an ounce

- Palladium rose 0.42% to $701.67 an ounce.

Latest comments

Loading next article…
Risk Disclosure: Trading in financial instruments and/or cryptocurrencies involves high risks including the risk of losing some, or all, of your investment amount, and may not be suitable for all investors. Prices of cryptocurrencies are extremely volatile and may be affected by external factors such as financial, regulatory or political events. Trading on margin increases the financial risks.
Before deciding to trade in financial instrument or cryptocurrencies you should be fully informed of the risks and costs associated with trading the financial markets, carefully consider your investment objectives, level of experience, and risk appetite, and seek professional advice where needed.
Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. The data and prices on the website are not necessarily provided by any market or exchange, but may be provided by market makers, and so prices may not be accurate and may differ from the actual price at any given market, meaning prices are indicative and not appropriate for trading purposes. Fusion Media and any provider of the data contained in this website will not accept liability for any loss or damage as a result of your trading, or your reliance on the information contained within this website.
It is prohibited to use, store, reproduce, display, modify, transmit or distribute the data contained in this website without the explicit prior written permission of Fusion Media and/or the data provider. All intellectual property rights are reserved by the providers and/or the exchange providing the data contained in this website.
Fusion Media may be compensated by the advertisers that appear on the website, based on your interaction with the advertisements or advertisers.
© 2007-2024 - Fusion Media Limited. All Rights Reserved.