London - Gold gained for the first time in four days in New York on concern that budget talks in Washington risk a federal government shutdown.
The US Senate is set to hold a test vote today on legislation passed by the House of Representatives to cover federal spending through December 15, and choke off funds for President Barack Obama’s health-care law.
The debate may extend past a September 30 deadline.
The next fiscal year begins October 1.
Russia and Kazakhstan were among nations that raised gold reserves in August, International Monetary Fund data show.
Gold is set for the first annual drop in 13 years as some investors lost faith in the metal as a store of value on optimism economies are strengthening.
Prices jumped to a one-week high on September 19, a day after the Federal Reserve unexpectedly refrained from slowing its $85 billion-a-month of bond buying.
Twenty-four of 41 economists surveyed by Bloomberg News on Sept. 18-19 said the Fed will take the first step in slowing its debt purchases in December.
“A lot of people are looking at the debt-ceiling talks,” which may support prices, Afshin Nabavi, a senior vice president at bullion refiner MKS (Switzerland) SA in Geneva, said by phone.
“The market is confused about the Fed. We’re not seeing too much physical demand around.”
Gold for delivery in December rose 0.5 percent to $1,322.50 an ounce by 7:54 a.m. on the Comex in New York.
Futures trading volume was 31 percent below the average for the past 100 days for this time of day, data compiled by Bloomberg showed.
Gold for immediate delivery in London lost 0.1 percent to $1,322.39.
“The entire focus is on the fact the money-printing program is going to wind back soon,” said Steven Dooley, head of research at Forex Capital Trading Pty in Melbourne, referring.
“That means gold’s going to drift lower.”
Holdings in gold-backed exchange-traded products rose 2.9 metric tons yesterday from a three-year low to 1,935.3 tons, data compiled by Bloomberg shows.
Russia added about 12.7 tons to reserves last month and Kazakhstan bought 2.5 tons, data on the IMF’s website show.
Silver for December delivery rose 0.5 percent to $21.695 an ounce in New York.
Platinum for January delivery gained 0.8 percent to $1,433.70 an ounce.
Palladium for December delivery added 0.4 percent to $722.70 an ounce.
The National Union of Mineworkers said it will go to court to try to halt job cuts at Anglo American Platinum Ltd. mines in South Africa.
The Association of Mineworkers and Construction Union, representing 54 percent of employees, gave the Johannesburg-based company notice it will strike on September 27, AMCU Treasurer Jimmy Gama said yesterday. - Bloomberg News