Gold Falls to Six-Week Low on Draghi Deflation Warning |
| Bloomberg - Oct 24, 2012 |
Gold futures fell below $1,700 an ounce to a six-week low as European Central Bank President Mario Draghi said his plan to buy government bonds “will not lead to inflation.”
Draghi told lawmakers in Berlin that “in our assessment, the greater risk to price stability is currently falling prices in some euro-area countries.” German business confidence unexpectedly dropped in October amid Europe’s sovereign-debt crisis. Gold jumped 11 percent in the third quarter after the U.S., Europe and Japan announced economic stimulus measures.
“The market is sensing the deflationary worries, and that is not good for gold,” Michael Gayed, the chief investment strategist and co-portfolio manager of ATAC Inflation Rotation Fund at New York-based Pension Partners LLC, which advises on more than $150 million in assets, said in a telephone interview.
Gold futures for December delivery fell 0.5 percent to settle at $1,701.60 at 1:45 p.m. on the Comex in New York. Earlier, the price touched $1,698.90, the lowest for a most- active contract since Sept. 7.
Read Full Article from Bloomberg
- Posted: 2012-10-24 14:50:46
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