Gold retreats further to B18,600

Gold prices dropped 50 baht on Wednesday from the previous close on Tuesday.

The Gold Traders Association announced at 9.22am on Wednesday the buying price at 18,500 baht and the selling price at 18,600 baht per baht-weight for gold bars.

The buying price for gold ornaments was 18,237.48 while their selling price was 19,000 baht per baht-weight.

In world markets, gold futures fell to the lowest since January on early Wednesday as the outlook for higher US interest rates and a stronger dollar cut demand for precious metals as hedges against inflation.

Money managers cut their bullish gold wagers for six straight weeks, the longest exit in more than four years, government data show. Global holdings in exchange-traded products backed by the metal last week shrunk to the lowest since 2009 as prices move close to erasing their 2014 gain,  according to Bloomberg .

Bullion, which rallied in the first half of the year amid escalating tensions in Ukraine and the Middle East, posted its first quarterly decline in 2014.

“It’s really been the dollar that probed gold lower since the beginning of July,” Adrian Day, the president of Adrian Day Asset Management in Annapolis, Maryland, said in a telephone interview.

Gold futures for December delivery slid 0.6% to settle at $1,211.60 an ounce on the Comex in New York at 1.43pm after touching $1,204.30, the lowest since Jan. 2. Prices fell 8.4% this quarter.

The greenback climbed to the highest since 2010 against a basket of 10 currencies today and is heading for the biggest quarterly gain since 2008. The Fed on Sept 17 raised its outlook for interest rates, signalling the central bank is committed to keeping inflation in check.

Jeffrey Currie, the head of commodities research at New York-based Goldman Sachs Group Inc, says the worst isn’t over for gold, forecasting prices at $1,050 by year-end. Societe Generale SA is also expecting more losses.