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Gold ETFs Weaken as Fed’s Fisher Hints at End to QE


Gold exchange traded funds are losing ground with  gold futures dipping below $1,300 after a Federal Reserve official hinted that it is closer to tapering the bond purchasing program.

The SPDR Gold Shares (GLD) was down 1.5% Tuesday. GLD has declined 22.4% year-to-date.

Federal Reserve Bank of Dallas President Richard Fisher said a decision to slow purchases is “closer to execution mode,” according to InvestmentNews.

“Bullion was weighed down by comments from Dallas Federal Reserve President Richard Fisher,” James Steel, an analyst at HSBC Securities (USA) Inc., said in the article. Fisher showed the central bank “is now a step closer to withdrawing from its quantitative easing program.”

Gold futures fell 1.6% Tuesday, trading around $1,282 per ounce.

As gold prices declined, physical holdings in GLD also extended losses, dropping to 917.14 metric tons Monday, its lowest level since February 2009.

Meanwhile the Market Vectors Gold Miners ETF (GDX) plunged 4.9%. GDX has been one of the worst performing ETFs so far this year, plunging 45.2% year-to-date. [Silver Miners Slammed on Fresnillo Dividend Cut]

SPDR Gold Shares

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Max Chen contributed to this article.

Full disclosure: Tom Lydon’s clients own GLD.

The opinions and forecasts expressed herein are solely those of Tom Lydon, and may not actually come to pass. Information on this site should not be used or construed as an offer to sell, a solicitation of an offer to buy, or a recommendation for any product.