Gold, the year’s
best-performing commodity, dropped the most in almost seven months as
rebounding global equities cut demand for a haven.
The metal slid as much
as 2.5 percent in London on Monday. European stocks headed for the
biggest two-day gain in more than four years as People’s Bank of China
Governor Zhou Xiaochuan expressed faith in the economy, while a stronger
dollar eroded the bullion’s appeal as an alternative investment.
Gold surged to a
one-year high last week and investors have been hoarding metal through
bullion-backed funds as a gauge of world stocks entered a bear market
and the Federal Reserve signaled it may delay further monetary
tightening. Low borrowing costs boost gold’s appeal because it doesn’t
pay interest like some other assets.
Gold for immediate
delivery slid 2.3 percent to $1,209.30 an ounce in New York, a
back-to-back daily decline for the first time in a month, according to
Bloomberg generic pricing. Prices are still up 14 percent this year, the
best performance in the Bloomberg Commodity Index of 22 raw materials.
Chinese trading
resumed after the week-long Lunar New Year holiday, while U.S. markets
are closed Monday for the Presidents’ Day holiday.
Source: Bloomberg
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