Azernews.Az

By Bloomberg

Gold fell to the lowest in seven weeks after Greece reached a provisional bailout deal with euro-area finance ministers, reducing demand for the metal as a haven. Platinum slid to the lowest since 2009.

Greece has until the end of Monday to complete a list of policies in return for a four-month extension of funds. European finance chiefs will then decide whether the proposals go far enough or trigger another round of negotiations. Gold, little changed this year, reached a five-month high in January partly as concerns that Greece could be forced out of Europe’s common currency increased the metal’s haven appeal.

U.S. Federal Reserve Chair Janet Yellen may use testimony to Congress this week to update the central bank’s view after policy makers signaled at their Jan. 27-28 meeting they are willing to keep interest rates low for longer given risks to the economy. Gold fell a second year in 2014, partly on the prospects for the Fed to raise borrowing costs.

“Clearly anything that is not a complete breakdown in Greece is being read as a negative for gold,” Matthew Turner, an analyst at Macquarie Group Ltd., said by phone in London on Monday. “But as long as there is no great shocks, the market focus will shift to Yellen’s testimony.”

Gold for immediate delivery fell 0.7 percent to $1,193.84 an ounce in London trading by 10:43 a.m. The metal reached $1,191.19 earlier Monday, the lowest since Jan. 5. Bullion for April delivery fell 1 percent to $1,193.20 on the Comex in New York. Futures trading volume was 29 percent below the average for the past 100 days for this time of day, according to data compiled by Bloomberg.

Net-Long Position

Money managers cut net-long wagers on gold by the most in 15 weeks, according to U.S. government data. The net-long position tumbled 18 percent to 110,164 futures and options contracts in the week ended Feb. 17, according to Commodity Futures Trading Commission data. It was the third consecutive decline, the longest streak since November. Short holdings surged 44 percent, the most since August.

Metal in bullion-backed, exchange-traded products increased for a third session as of Friday, climbing to 1,675.7 metric tons.

Silver for immediate delivery slipped 0.3 percent to $16.1951an ounce. Platinum fell 0.4 percent to $1,160.63 an ounce and palladium was little changed at $780.75 an ounce.

Gold’s ratio to platinum retreated from the two-year high it reached on Friday. Gold is 0.8 percent higher this year, while platinum has fallen 3.9 percent, touching the lowest since July 2009 on Monday.