Gold falls

Gold fell 1.5 percent on pressure from weak oil prices and gains in the US dollar on Wednesday, and was poised to end 2014 down a slight 2 percent after falling below $1,200 an ounce. The impact of a stronger dollar was partially offset by demand from investors worried about tensions in Russia and political uncertainty in Greece. Bullion was on track for a small fall this year after a turbulent 2013, when prices fell by a third following 12 years of gains.
Spot gold was down 1.5 percent at $1,182.30 an ounce by 2:39 pm EST (1939 GMT). On Tuesday, it had climbed to a near two-week high of $1,209.90 as concerns over tension between Russia and the West weakened the dollar and stock markets. US gold futures for delivery in February settled down 1.4 percent at $1,184.10 an ounce, closing 2014 down 1.5 percent from the end of 2013. "It appears that gold is following oil for now," said Eli Tesfaye, senior market strategist for RJO Futures in Chicago.
Prices were relatively less volatile in 2014 compared with last year's 28 percent slide and $500 trading range. Despite falling to a 4-1/2-year low in November, gold has traded in a $260 range for the year. "Considering the strong dollar performance in 2014, gold's downside this year has been a little bit protected by international political events that have attracted some safe-haven buying, especially in the first half," ABN Amro commodity strategist Georgette Boele said.
Investors continued to run down gold holdings in 2014, with the world's largest gold-backed exchange-traded fund, the SPDR Gold Trust, falling by 140 tonnes to six-year lows of 710.81 tonnes. Redemptions, however, were much smaller than in 2013, when the fund saw a record outflow of 460 tonnes, or 39 percent, to around 850 tonnes. Silver fell 3.9 percent to $15.63 an ounce and was on track for a 19.5 percent annual decline and platinum, down 1.1 percent at $1,200.40 an ounce, was headed for a yearly fall of 12 percent. With an 11 percent jump, palladium was the best-performing precious metal this year, mostly on supply concerns from top producer Russia. Palladium prices were down 0.9 percent at $793.00 an ounce on the day.