* Gold falls in tandem w/commods as investor sentiment dips
* SPDR gold ETF sees biggest 1-day drop in over 3 months
* Reuters poll shows gold expected to plateau in 2012
* Coming up: U.S. Dec. new home sales due Wednesday
(Recasts, adds comments, updates prices, new byline, changes
dateline, previously LONDON)
By Frank Tang
NEW YORK, Jan 25 (Reuters) - Gold fell for a fourth
straight day on Tuesday, putting the metal on track for its
first monthly drop since August, as selling in gold exchange
traded funds (ETF) further undermined investor demand for
bullion.
Analysts, however, expect gold's 10-year bull run to remain
intact due to lingering economic uncertainty, a view confirmed
by a comprehensive Reuters poll that called for an average
price of $1,450 an ounce in 2011.
Gold, whose safe haven play has diminished of late, fell in
tandem with other industrial commodities, with U.S. crude oil
falling 1.5 percent and copper dropping to its lowest since
late December. The Reuters-Jefferies CRB index <.CRB> headed
for its sharpest loss in three weeks. [] [] []
Barclays Capital analysts cited an outflow in the holdings
of gold exchange traded products for its price weakness.
Investor sentiment towards gold has soured in the last few
sessions, reflected in the largest one-day outflow in three
months from the world's biggest gold ETF.
Holdings in the SPDR Gold Trust <GLD> fell 10.926 tonnes to
1,260.843 tonnes on Jan 24, its largest one-day outflow in
three months, after rising more than 20 tonnes in the previous
session. It is down about 20 tonnes in January. []
Spot gold <XAU=> fell 0.2 percent to $1,332.04 an ounce at
1:09 p.m. EST (1809 GMT), having earlier hit a three-month low
at $1,322.70. U.S. gold futures for February delivery <GCG1>
settled down $12.2 at $1,332.30.
Spot prices are on course for a 6 percent decline in
January, which would be the biggest monthly fall since a
7-percent drop in December 2009. Selling is largely a
consequence of a current run of positive economic data.
"Nothing fundamentally has changed at all. It's just that
too many investors have gotten long (bullish)," said Dennis
Gartman, publisher of the Gartman Letter.
"The weakness in the past week and a half has made those
late to the party uncomfortable, forcing them to sell. In the
process, it will make the market healthy again," he said.
For the moment, strong consumer demand, particularly in
Asia, continues to provide a floor for spot gold prices,
dealers said.
However, trade data by the Commodity Futures Trading
Commission (CFTC) showed investment interest, measured by the
net speculative long bullish position in U.S. gold futures,
fell to the lowest level since July of 2009. The significant
decline in spec longs has eased some selling pressure, analysts
said.
Adding to the case against gold was strong demand at the
euro zone rescue fund's first debt offer, which helped push the
euro to two-month highs. The single currency later lost ground
in a volatile session . []
The European Financial Stability Facility (EFSF) launched
its first sale of bonds and market sources said demand, at 48
billion euros, dwarfed the 5 billion on offer. []
REUTERS POLL SHOWS GOLD PLATEAUING
Longer term, ongoing jitters over growth and expectations
interest rates will stay low for now are buoying analysts'
expectations for gold, a Reuters poll of 65 analysts released
on Tuesday showed.
However, they see prices plateauing next year as economic
conditions normalize. []
"We expect gold prices to continue to climb in 2011 as the
resumption of quantitative easing should keep U.S. real
interest rates low," Goldman Sachs said in a report.
"However, with the current round of QE set to end in June
2011, and our U.S. economics team now forecasting strong U.S.
economic growth in 2011 and 2012, we expect U.S. real interest
rates to begin to rise into 2012, likely causing gold prices to
peak in 2012."
Spot silver <XAG=> fell 0.5 percent to $26.79 an ounce,
having earlier fallen to $26.54, its lowest in nearly two
months.
ETF flows have also undermined silver. Holdings of metal in
the iShares Silver Trust <SLV>, the world's largest silver ETF,
have fallen by 425.3 tonnes so far this month, worth about $364
million at today's prices.
Platinum <XPT=> fell for a second day, down 1.8 percent to
$1,779.99 an ounce, while palladium <XPD=> fell 3.7 percent to
$779.97, set for its biggest daily fall since mid-November.
Prices at 1:25 p.m. EST (1825 GMT)
LAST NET PCT YTD
CHG CHG CHG
US gold <GCG1> 1331.90 -12.60 -0.9% -6.3%
US silver <SIH1> 26.810 -0.506 -1.9% -13.3%
US platinum <PLJ1> 1786.00 -33.60 -1.9% 0.4%
US palladium <PAH1> 783.05 -33.50 -4.1% -2.5%
Gold <XAU=> 1331.96 -2.29 -0.2% -6.2%
Silver <XAG=> 26.81 -0.10 -0.4% -13.1%
Platinum <XPT=> 1780.24 -31.75 -1.8% 0.7%
Palladium <XPD=> 779.97 -29.53 -3.6% -2.4%
Gold Fix <XAUFIX=> 1324.00 -2.00 -0.2% -6.1%
Silver Fix <XAGFIX=> 26.70 -86.00 -3.1% -12.8%
Platinum Fix <XPTFIX=> 1787.00 0.00 0.0% 3.2%
Palladium Fix <XPDFIX=> 786.00 0.00 0.0% -0.6%
(Additional reporting by Amanda Cooper and Jan Harvey in
London;editing by Sofina Mirza-Reid)
