Gold price comes off all-time high, falls 2.76 pc in 2013 so far


Barring a late price surge, gold’s value will suffer its first annual drop since the start of the millennium, while the precious metal risks further losses in 2014. According to gulfnews.com, gold stood at USD 1,205 an ounce Friday on the London Bullion Market, down almost 27 per cent in 2013 on weaker demand and easing inflation – snapping 12 years of uninterrupted annual price growth. That leaves gold, whose twin drivers are jewelry demand and investment buying, set for its the first annual price loss since 2000 when its value had fallen by 5.6 per cent. Gold’s value took a knock during 2013, also from growing speculation that the US Federal Reserve would start to scale back its quantitative easing (QE) stimulus programme that propped up the world’s biggest economy by billions of dollars. Gold in June hit a three-year low at USD 1,180.50 an ounce on Fed speculation, before bouncing back. It came close to matching this level at the end of last week as the US central bank ended months of speculation by finally announcing it would start to scale back its stimulus next month. Macquarie banking group analyst Matthew Turner told gold demand had fallen for a variety of reasons, including “a growing anticipation of the Fed ending QE… a reduced sense of crisis around the world and the fact that inflation has fallen in most countries this year, especially in the US”. He added: “This last point is very important – the concept of QE leading to inflation has not really happened.” Gold is seen also as a hedge against rising prices.

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