Gold loses shine as it heads for first weekly loss since May

Jessica Morris
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Gold Rises To New 25-Year High Above $725
Gold fell to its lowest level in two weeks yesterday (Source: Getty)

Bullion's longest rally in more than two years could draw to a close today, as an improving global outlook hit investor appetite for the safe haven.

After six weeks of gains, bullion came under pressure this week, down 2.5 per cent so far. It's been hit by strong economic data out of the US, as well as easing anxieties over the implications of Britain's vote to leave the European Union.

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The brighter sentiment sent spot gold down 0.57 per cent to $1,327.58 an ounce in late afternoon trading. It fell to its lowest level in two weeks yesterday.

US gold also shed 0.35 per cent to $1,327.60.

Nevertheless, analysts remained bullish about this year's outlook for gold.

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"Investors are taking profits, but $1,300 is now a floor for gold and that is going to hold moving forward," ING Bank senior strategist Hamza Khan said.

"Wider political issues such as the US elections and then French and German elections next year are enough to support gold even though markets are rallying on the low interest rates environment and the quest for yields."

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