Gold holdings shrink most in seven months
Feb 18 2013
Assets contracted 0.5 per cent last week, the biggest such decline since July, according to data compiled by Bloomberg. The holdings, which reached a record in December, dropped to a three-month low of 2,602.335 tonnes on February 15. Billionaire investors George Soros and Louis Moore Bacon cut their stakes in gold ETPs last quarter, while John Paulson maintained his share, government filings showed last week.
Analysts from Goldman Sachs Group to Credit Suisse Group are calling for gold to peak in 2013 after a 12-year bull run as the global economy rebounds. Manufacturing in the New York region unexpectedly expanded in February, and consumer confidence rose to a three-month high, separate reports showed last week. China’s economy may expand 8.1 per cent this year from 7.9 per cent in 2012, according to the median of analysts’ forecasts compiled by Bloomberg.
“It’s still early days to declare that we’re out of the economic doldrums, however, with data showing signs of improvement, investors would rather put their money into riskier assets,” said Sun Yonggang, a macroeconomic strategist at Everbright Futures, a unit of one of China’s largest state-owned investment companies.
Gold for April delivery gained as much as 0.6 per cent to $1,618.80 per troy ounce, and traded at $1,617.60 at 10:31 am in Singapore. The metal slumped to $1,596.70 on February 15, the cheapest since August.
Bets by hedge funds and other large speculators on higher prices tumbled to the lowest since December 2008 in the week to February 12, US Commodity Futures Trading Commission data show.
Bullion has fallen 3.5 per cent this year, lagging behind gains in platinum and palladium as faster economic growth drives demand for the metals used mainly in industry amid concern about lower supplies. Platinum’s premium to gold widened to an almost 18-month high last week.