Thursday is likely to see gold futures lose value for the first time in three consecutive trading sessions as grave preoccupations usher leaders of the European Union into the two-day summit beginning Thursday in Brussels, according to published reports.
Doubts have reared regarding the ability to solve the two-year old sovereign debt scourge that has seen Ireland, Greece and Portugal accept bailout aid to rescue their debt-hobbled banks and public finance systems while Italy and Spain are teetering on the precipice. A stress test revealed deepening fissures in European banks due to the scourge, Reuters reports.
"The variety of official European meetings today and, more particularly, tomorrow, are a significant risk event," precious metal analyst David Jollie with Mitsui & Co. in London told Bloomberg on Thursday. "Most of the market is happy to remain long ahead of the meeting but some more nervous investors may be choosing to flatten their positions, creating a little selling pressure."
At 6:30 a.m. on Thursday, gold futures dropped 0.18 percent, a $3.20 reduction to $1,741.60 per troy ounce.
The European Central Bank is likely to slash interest rates by a quarter of one percentage point on Thursday when it gathers in Frankfurt, according to Bloomberg.
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