SINGAPORE (Reuters) - Gold
slipped on Thursday as the dollar firmed after minutes from a U.S.
Federal Reserve policy meeting indicated support for continued tapering
of its stimulus.
The tapering, which highlights a recovery in the U.S. economy, will
diminish gold's investment appeal as a hedge against inflation. The
metal sank to a six-month low on December 31 on prospects for a global
economic recovery.
Gold hit an intraday high of $1,314.50 before slipping to $1,309.85
by 0332 GMT, down $1.40. It crossed the psychological level of $1,300
this month, but gains have been capped at a 3-1/2 month high of
$1,332.10 hit on Tuesday.
"It's still rangebound for gold. It's broken a few tiers but at the
moment, it's still capped within $1,330," said Brian Lan, managing
director of GoldSilver Central Pte Ltd in Singapore.
"What we can see is that it should correct a little because the rise
has been too sharp," said Lan, who pegged key support at $1,305 an
ounce.
But dealers expected jewellers to buy on dips while India's plan to
keep tax on gold imports at current levels could underpin sentiment in
the physical market as it will lead to more smuggling.
Gold demand in India is expected to be robust in 2014 and likely to
encourage an increase in smuggling if curbs on bullion imports remain,
the World Gold Council has said.
U.S. gold fell $10.50 to $1,309.90 an ounce.
Premiums for gold bars in Singapore were mostly steady from last
week at $1.20-$1.50 an ounce to spot London prices. Dealers noted buying
from jewellers in Indonesia, while Thailand sold some scraps to
Singapore.
"I've got some light demand from Indonesia but it's more for
factories and not for investment. Thailand has been quite slow since the
beginning of last week," said a dealer in Singapore.
"Business in Thailand has been hit by the unrest. People are complaining."
Pradeep Kumar Shukla Source- Yahoo news
PGDM 2Sem
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