Gold may decline on speculation that investors are locking in gains after the price rose to a record earlier, and as central bank efforts to combat inflation curbed demand for precious metals.
Immediate-delivery bullion decreased as much as 0.3 percent to $1,455.47 an ounce before trading at $1,457.72 at 9:45 a.m. in Singapore. The price gained to a record $1,462.35 earlier. Gold for June delivery in New York were little changed at $1,459.10 an ounce after reaching an all-time high of $1,463.70 yesterday.
“Some traders are taking profits after the recent rally to record prices,” said Park Jong Beom, Seoul-based trader with Tongyang Futures Co. “Policies to raise interest rates are also weighing on sentiment a bit.”
Gold climbed to a record this week as fighting in Libya, Japan’s nuclear crisis and concerns about European debt boosted demand for the metal as a protector of wealth. Bullion is up 2.5 percent this year, after jumping 30 percent in 2010 as investors sought sanctuary from currency debasement and accelerating inflation.
China raised interest rates this week for the fourth time since mid-October before a report that may show consumer prices climbed last month at the fastest pace since 2008. Federal Reserve Chairman Ben S. Bernanke this week said inflation must be watched “extremely closely.” Minutes from the Fed’s March 15 meeting, released yesterday, show dissent on maintaining programs intended to stimulate growth.
The U.S. has kept its benchmark interest rate at a record low since December 2008. Rising interest rates tend to increase the cost of holding non-interest-bearing commodities.
Cash silver fell 0.5 percent to $39.3763 an ounce after climbing to a 31-year peak of $39.7625 an ounce yesterday. Palladium for immediate delivery lost 0.2 percent to $785 an ounce, while platinum was little changed at $1,791.75 an ounce.
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