Gold halts decline, gains limited by dollar

LONDON (July 8) Gold has moved higher today in commodities trading, ending a two-day decline sparked by concerns over the end of the US Federal Reserve's quantitative easing (QE) programme. 

Bullion has declined by more than ten per cent since Fed chairman Ben Bernanke last month stated the world's largest economy is recovering sufficiently to begin reducing the central bank's asset purchases before the end of the year. 

This tapering of QE is expected to lead to a rise in interest rates and higher dollar, which will make gold a less attractive proposition.

After a major US employment report showed on Friday that 195,000 new jobs were added in the country in June, speculation increased that the Fed could take action in the near future and caused bullion to shed more than two per cent.

Today, spot gold advanced by 1.41 per cent to $1,236.64 per ounce as of 1:49 ET, while silver advanced 1.54% per ounce to $19:09.