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Gold declines for second day as ECB easing seen curbing demand
[LONDON] Gold declined for a second day on speculation economic stimulus by the European Central Bank will lessen demand for haven assets.
ECB policy makers led by Mario Draghi will propose purchasing 50 billion euros (US$58 billion) in assets each month through 2016, two central-bank officials told Bloomberg News before their meeting on Thursday in Frankfurt.
Gold has climbed 8.8 per cent this year on signs of a global economic slowdown.
"There has been a perception that central banks have been losing control, with several changing policy unexpectedly, thus fueling demand for gold," Matthew Turner, a precious metals analyst at Macquarie Group Ltd, said by phone from London.
"The ECB can restore calm today if its policy is seen as effective and commanding broad support."
Gold for immediate delivery fell 0.5 per cent to US$1,286.73 an ounce at 10:10am in London, according to Bloomberg generic pricing. Prices on Wednesday briefly topped US$1,300, a five-month high.
Futures for February delivery fell 0.6 per cent to US$1,286.10 on the Comex in New York.
Investors slowed purchases of exchange-traded products backed by gold, with holdings increasing 2.9 metric tons to 1,636.4 tons. The previous three sessions saw average inflows of 12.6 tons, data compiled by Bloomberg show.
Silver for immediate delivery retreated 0.4 per cent to US$18.0582 an ounce. Platinum added 0.2 per cent to US$1,275.88 an ounce and palladium fell 0.5 per cent to US$763.75 an ounce.