With the Fed’s next policy meeting looming this week, hedge funds are exiting from gold. Speculators cut their bets on a bullion rally by the most in more than three months. Holdings in global exchange-traded funds backed by the metal are down from a three-year high in August and heading for the biggest monthly decline this year. Aggregate open interest in New York futures is mired in the longest slump since May.
…The Fed is “going to have to eventually raise rates and acknowledge that inflationary pressures have been rising,” Quincy Krosby, a market strategist at Prudential Financial Inc., which oversees about $1.3 trillion, said in a telephone interview. “Certainly, you want to take some profit” from gold investments before that happens, she said.
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David Llewellyn-Smith is Chief Strategist at the MB Fund and MB Super. David is the founding publisher and editor of MacroBusiness and was the founding publisher and global economy editor of The Diplomat, the Asia Pacific’s leading geo-politics and economics portal.
He is also a former gold trader and economic commentator at The Sydney Morning Herald, The Age, the ABC and Business Spectator. He is the co-author of The Great Crash of 2008 with Ross Garnaut and was the editor of the second Garnaut Climate Change Review.
