Gold fell for a second day, paring a 12th quarterly gain, as concern European leaders may not stem the region’s debt crisis hurt stocks and commodities, forcing some investors to sell the metal to cover losses elsewhere.
Immediate-delivery gold lost as much as 1.5 percent to $1,584.38 an ounce, and traded at $1,593.35 at 8:27 a.m. in Singapore. December-delivery bullion lost as much as 2 percent to $1,586.20 an ounce in New York.
Gold has fallen on “traders needing cash for margin calls on weak equity prices and newfound strength in the U.S. dollar,” Jonathan Barratt, managing director at Commodity Broking Services Pty., wrote in a report. “The turmoil in Europe only seems to be getting worse.”
Lawmakers in Germany, Europe’s largest economy, are set to vote today on boosting the region’s rescue fund amid resistance by the European Commission to impose bigger writedowns on bank holdings of Greek government debt than those previously agreed.
U.S. stocks ended a three-day rally yesterday and commodities are headed for the biggest quarterly slump since 2008 as European and International Monetary Fund officials return to Greece today to try put in place a package that will help the country stave off default. The dollar was little changed against a six-currency basket after rising yesterday.
Gold is still up 12 percent this year on concern that there may be another global recession as the debt crisis, which has Greece on the brink of default, worsens. The precious metal, which reached an all-time high of $1,921.15 on Sept. 6, has risen 6.2 percent since the end of June.
Cash silver lost as much as 2.5 percent to $29.105 an ounce, while December-delivery futures shed as much as 3.5 percent to $29.095 an ounce. Spot platinum dropped as much as 1.4 percent to $1,505.32 an ounce, while palladium was little changed at $620.75 an ounce.
To contact the reporter for this story: Glenys Sim in Singapore at gsim4@bloomberg.net
To contact the editor responsible for this story: James Poole at jpoole4@bloomberg.net
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