Bloomberg (07/11) -- Gold fell to a
three-week low as signs of better-than-expected economic growth fueled
bets that the Federal Reserve will trim monetary stimulus this year, and
the dollar rose after the European Central Bank announced an
interest-rate cutThe economy in the U.S. expanded in the
third quarter at a faster pace than forecast and jobless claims fell to
336,000 in the week ended Nov. 2 from 345,000 in the previous period,
separate government reports said today. The Bloomberg U.S. Dollar Index
surged the most in almost three months after the ECB unexpectedly cut
its main refinancing rate to a record low.“Today’s data says the economy is on the
right track and tapering may be coming soon,” Phil Streible, a senior
commodity broker at R.J. O’Brien & Associates, said in a telephone
interview from Chicago. “The dollar’s strength is crushing gold.”Gold futures for December delivery
declined 1 percent to $1,305.10 an ounce at 9:54 a.m. on the Comex in
New York, after falling to $1,296, the lowest for the most-active
contract since Oct. 17.Through yesterday gold fell 21 percent
in 2013 and prices are heading for their first annual loss since 2000 on
speculation that the Fed will curb stimulus amid an equity rally and
low inflation. The economy shows signs of “underlying strength,” central
bank policy makers said on Oct. 30.The statement pointed to the possibility of reduced bond purchases as soon as December, Citigroup Inc. and Barclays Plc said.Gold rose 70 percent from December 2008 to June 2011 as the Fed pumped more than $2 trillion into the financial system.Silver futures for December delivery dropped 1 percent to $21.56 an ounce in New York.
