Gold is suffering a massive collapse

Gold experienced a huge depreciation after the news that US business spending was still bouncing back.
23 Nov 2016 – Business Insider

Orders for things built to last such as appliances rose 4.8%, the Census Bureau said, while business capital goods orders increased by 0.4%, more than forecast.

Gold has been hit by expectations that the policies of U.S. president-elect Donald Trump will boost economic growth as well as strong U.S. data that has supported the case for an interest rate rise.

The precious metal was earlier weighed down by a strong dollar, though some analysts said that bullion could receive support from European political risks in the coming months.

Gold futures were down 2%, or $25.13 an ounce, to $1,188 at 11:38 a.m. ET. Spot gold fell below $1,200 for the first time since February.

Gold has shed about 10 percent from a peak hit in the aftermath of the U.S. election two weeks ago.

“It’s been a pretty dreadful time for gold. Everything that’s good for growth has been negative for gold,” said Robin Bhar, head of metals research at Societe Generale in London.

With traders pricing in a 100 percent chance of a December rate increase, according to the CME Group’s FedWatch Tool, gold’s decline may be bottoming out, Bhar added.

“I suspect that maybe 70 percent of the rate rise is priced into the market, and when it comes through, you may have ‘sell the rumor and buy the fact’,” he said.

The U.S. Federal Reserve next meets Dec. 13-14.

Uncertainty surrounding Italy’s constitutional referendum on Dec. 4 and French and German elections next year could support gold through safe-haven buying, Bhar said.

“Seasonally, as we move towards Christmas, New Year and Chinese New Year, that should see some physical support.”