This has not been a good year for gold investors.
Prices of the precious metal were at a three-week low Tuesday morning on speculation that a strengthening U.S. economy will spur the
Gold is down 24% this year, heading for its first yearly loss since 2000. Some investors lost faith in the metal amid a U.S. equity rally and low inflation.
Investors had turned to gold as safeguard against inflation after the Fed pumped more than $2 trillion into the financial system by purchasing debt. Gold surged 70% from December 2008 to June 2011.
Positive economic news has led to speculation that the Fed will ease its stimulus, creating less incentive for investors to buy gold. Last week the Labor Department reported that U.S. employers added a higher-than-expected 204,000 workers in October, news that may have put additional pressure on gold prices.
"Tapering has become the centerpiece again," Frank McGhee, the head dealer at Integrated Brokerage Services in Chicago told
Gold futures for December delivery were down less than 0.1% at about $1,280 on Tuesday morning, after touching $1,275.80, the lowest since Oct. 17. Prices swung between gains and losses, earlier rising as much as 0.3%.
Trading was 31% below average for the past 100 days, data compiled by Bloomberg showed.