Feb. 27 (Bloomberg) -- Gold futures dropped, heading for the longest run of monthly declines in 16 years, as confidence that the U.S. economy is recovering curbed demand for the metal as an investment hedge.
In January, an index of pending home resales in the U.S. increased to highest since April 2010, and a measure of durable- goods orders climbed the most in a year, reports showed today. Yesterday, gold jumped the most in three months as Federal Reserve Chairman Ben S. Bernanke defended monetary stimulus.
“The safe-haven premium is definitely falling,” Vedant Mimani, a portfolio manager at Atyant Capital Management Ltd. in Miami, said in a telephone interview. “Also, some people are booking profit after yesterday’s big gain.”
Gold futures for April delivery fell 1.2 percent to settle at $1,595.70 an ounce at 1:38 p.m. on the Comex in New York, the biggest slide in a week. This month, the price has declined 4 percent, poised for the fifth straight drop and the longest slump since January 1997.
The index of pending-home resales increased 4.5 percent to 105.9, a report from the National Association of Realtors showed. The median forecast in a Bloomberg survey called for a 1.9 percent advance. Government data showed that orders for durable goods excluding transportation equipment climbed 1.9 percent, exceeding all forecasts in another survey.
“Investors have the tendency to buy less of the precious metal in an environment where growth is stabilizing,” Credit Suisse Group AG’s private-banking unit said in a report.
Holdings in exchange-traded funds backed by gold fell to a five-month low of 2,530 metric tons yesterday, data compiled by Bloomberg show. This month, they have dropped 3.1 percent, the most since April 2008.
Silver futures for May delivery declined 1.1 percent to $28.985 an ounce on the Comex, the biggest drop in a week.
On the New York Mercantile Exchange, platinum futures for April delivery fell 1 percent to $1,600.10 an ounce.
Palladium futures for March delivery rose 0.5 percent to $745.65 an ounce.
--With assistance from Glenys Sim in Singapore. Editors: Patrick McKiernan, Thomas Galatola