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Gold slumps as stronger dollar, share market gains cut demand
[SINGAPORE] Gold fell, extending the first back-to-back weekly drop since May, as buoyant equity markets and gains in the dollar hurt demand ahead of central bank meetings in the US and Japan this week.
Bullion for immediate delivery dropped as much as 0.4 per cent to US$1,317.26 an ounce and traded at US$1,318.60 at 8:48 am in Singapore, according to Bloomberg generic pricing.
The metal lost 1.1 per cent last week after shedding 2.1 per cent the week before.
Gold's rally this year has been trimmed as a stronger dollar and rebound in equities cut demand for the metal as a store of value. The S&P 500 ended at a record on Friday amid signs of strength in the US economy.
Federal Reserve policy makers meet on July 26-27, with traders pricing in 10 per cent odds of a rate rise, while a majority of economists surveyed by Bloomberg project the Bank of Japan will step up stimulus at the meeting ending on July 29.