Investors sell out of biggest gold trust

New York

INVESTORS in the world's biggest exchange-traded product backed by bullion sold the most gold in 18 months as the US economic recovery cut demand for a haven. Holdings in the SPDR Gold Trust fell 1.6 per cent on Tuesday to 712.9 metric tonnes, the biggest drop since June 2013. Assets declined to the smallest since September 2008.

Bullion for immediate delivery is heading for the first back-to-back annual decline since 2000. A collapse in oil prices is curbing demand for the metal as an inflation hedge, while the Federal Reserve is moving closer to increasing interest rates. Gains for the dollar and US equities have also made gold less attractive as an alternative asset.