Gold today traded rose to near $1,400 an ounce as investors weighed a decline in equities against speculation the US Federal Reserve will curb its stimulus program.
Gold added 0.1 per cent to $1,401.24 an ounce and silver by 0.2 per cent to 22.58 an ounce.
Global equities fell to near a one-month low set June 3 after declining the past two weeks. Fed Bank of Kansas City President, who has dissented against the latest round of asset purchases at every policy meeting this year, urged the Fed to slow its bond-buying program.
Gold slid 16 per cent this year as equities rose and on speculation the Fed may scale back quantitative-easing measures that helped bullion cap a 12-year bull run in 2012.
Holdings in exchange-traded products fell 2.8 tonnes to 2,141.8 tonnes, the lowest since May 2011.
India, last year’s biggest bullion consumer, widened curbs on imports to narrow a record current-account deficit yesterday. The restrictions on overseas purchases by banks on a consignment basis will be expanded to include state-run trading companies and others authorised to directly import gold, the Reserve Bank of India said.
As Indian imports slow or are halted as the market adapts to the new regulations, domestic supply may be “squeezed”, potentially pushing up premiums there, UBS said.