London/Singapore: Gold headed for its first back-to-back weekly decline since May, with gains in equity markets and the dollar hurting prices as investors return to riskier assets and weigh the possibility of additional economic stimulus.
Bullion for immediate delivery fell as much as 0.7 per cent to $1,321.78 an ounce on Friday and traded at $1,324.47 at 11.52am in London for a 1 per cent loss this week, according to Bloomberg generic pricing. Silver was set for the biggest weekly drop in almost two months.
Gold has pared this year’s rally as Asian stocks reached an eight-month high this week and the dollar strengthened. European Central Bank president Mario Draghi signalled on Thursday that the bank stands ready to take further measures if needed after the UK vote to quit the European Union. The Federal Reserve’s next policy meeting ends July 27.
“The weekly decline is due to the improvement in risk appetite,” Naeem Aslam, the chief market analyst at Think Markets UK Ltd., said by email. “Central banks have started to cherry-pick data to downplay risk, leading to fading demand for the metals.”
AngloGold Ashanti Ltd., Africa’s top bullion producer, today said it returned to profit in the first half thanks to higher prices, focusing on costs and weaker currencies in countries it operates in. The shares rose as much as 3.4 per cent and have almost tripled this year.
