A nasty slide for gold

The price of gold fell sharply recently following the US Federal Reserve's refusal to announce another round of money printing.

Gold suffered a nasty fall last Wednesday. It slid by almost $100 to around $1,700 an ounce, and this week it fell further on technical selling: its slide triggered automatic sell orders, reinforcing the trend.

US Federal Reserve chairman Ben Bernanke's refusal to announce more money printing (QE3) was blamed for the drop, which was compounded by a massive sell order, according to precious metals trader Sharps Pixley.

MoneyWeek

Subscribe to MoneyWeek today and get your first six magazine issues absolutely FREE

Get 6 issues free
https://cdn.mos.cms.futurecdn.net/flexiimages/mw70aro6gl1676370748.jpg

Sign up to Money Morning

Don't miss the latest investment and personal finances news, market analysis, plus money-saving tips with our free twice-daily newsletter

Don't miss the latest investment and personal finances news, market analysis, plus money-saving tips with our free twice-daily newsletter

Sign up

Asian jewellers and money managers continue to buy on price weakness. Central banks, whose gold purchases have bolstered the market, will continue to buy gold this year, says the Royal Bank of Scotland.

Destabilising defaults remain a threat in Europe. Supply is still tight, notes Marketoracle.co.uk: of the four top gold producers, only China has boosted production in recent years, but this gold is largely consumed in China rather than exported to the international market. Stay long, says Morgan Stanley.

Explore More
MoneyWeek

MoneyWeek is written by a team of experienced and award-winning journalists, plus expert columnists. As well as daily digital news and features, MoneyWeek also publishes a weekly magazine, covering investing and personal finance. From share tips, pensions, gold to practical investment tips - we provide a round-up to help you make money and keep it.