Concerns about the U.S. political impasse over budgetary and debt ceiling issues dragged down gold futures on Wednesday as the precious metal continued its yearlong downward dive, according to Bloomberg.
Thus far in 2013, the yellowish metal has lost about 22 percent of its value, putting in peril the annual gains streak that presently stands at 12 years. The White House is set to nominate U.S. Federal Reserve vice chair Janet Yellen to succeed Ben Bernanke. If approved, Yellen would begin her tenure on February 1.
"A default of the U.S. government should be positive for gold, because it would be the only safe haven U.S. investors would have," consultant Peter Fertig with Quantitative Commodity Research told Reuters on Wednesday. "That gold is not reacting so strongly to the developments in the United States is surprising."
At 9:11 a.m. on Wednesday, gold futures dropped 0.76 percent, a $10.02 loss to $1,309.27 per troy ounce.
Analysts told Reuters that the inability of bullion to benefit from negotiation snags over U.S. fiscal, budgetary and debt issues indicates investor confidence in gold has dropped.
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