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Gold fell to a minimum of four weeks as investors transfer funds to riskier assets on a wave of optimism about the U.S. economy.
Last month, negotiations regarding assistance to Cyprus attracted the gold market buyers, who saw in this metal safe-haven asset that can protect their money from the uncertainty surrounding the future of the eurozone. Gold prices have exceeded $ 1,600, but this growth was unsustainable, after last week Cypriot banks have resumed their work in a fairly quiet environment. During 2013, gold futures lost 6% in value.
The economic situation in the U.S. has stabilized and stock indices surged to new highs, attracting investors to the promise of higher returns.
On Monday, it became known that manufacturing activity in the United States and China in the past month rose less sharply than economists expected. The data released on Tuesday, showed the continued decline in manufacturing activity in the euro area in March. Volume in U.S. factory orders rose in February by 3 percent, slightly above expectations.
Released on Wednesday, U.S. data on the employment rate and activity in the non-manufacturing sector was weaker than the market expectations, but investors are still prone to selling gold.
Dealers say the physical market buying from jewelers in Indonesia, but buyers in other countries, are projected to wait for further price reductions. Premium for gold bars in Singapore is $ 1.20 an ounce to the spot price in London.
Investors are waiting for coming in Friday's employment report in the U.S., which could support the view of the market that the Fed will keep policy extremely loose. Gold rose to a 11-month high in October of last year, when the Fed announced the third phase of "quantitative easing."
The cost of the June gold futures on COMEX today dropped to 1563.1 dollars per ounce.
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