Gold, little changed in New York, headed for a second straight weekly loss as China moved to fight inflation and slow growth, damping demand for precious metals and raw materials.
China ordered banks to set aside larger reserves for the second time in two weeks. The country is the biggest bullion consumer after India. The Thompson Reuters/Jefferies CRB Index of 19 commodities fell as much as 1.3%. Gold touched a record $1,424.30 U.S. an ounce on Nov. 9.
Gold futures for December delivery lost $2.80, or 0.2%, to $1,350.20 U.S. late Friday morning. on the Comex in New York. A close at that price would leave prices down 1.1% this week. The metal shed 2.3% last week.
The reserve requirement will increase 50 basis points starting Nov. 29, China’s central bank said on its website today. The move spurred speculation that the country will also raise borrowing costs.
The country’s inflation rate rose to a two-year high last month. Surging demand in China, the world’s biggest user of many commodities, lifted the CRB gauge more than 50% since 2001.
China bought 153.7 metric tons of gold in the third quarter, according to the producer-funded World Gold Council. India purchased 229.5 tons.
Before today, gold jumped 23% in 2010, heading for the 10th straight annual gain.
Silver futures for December delivery were up 1.5 cents, or 0.1%, to $26.85 U.S. an ounce. The metal climbed 59% this year through yesterday.
Palladium futures for December delivery rose $6.50, or 0.9%, to $702 U.S. an ounce on the New York Mercantile Exchange. Before today, the price surged 70% this year.
Platinum futures for January delivery added $4.50, or 0.3%, to $1,668.40 U.S. an ounce. Before today, the metal gained 13% this year.
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