Gold ends 5-day rally on Fed speculation

<p>Suggestions the Federal Reserve is close to reducing monetary stimulus have brought an end to gold’s recent run of gains.</p>

Gold has fallen back from a three-month high amid speculation that US economic data to be released today (August 29th) will encourage the Federal Reserve to begin scaling back its quantitative easing programme.

Fears over potential military action in Syria had boosted bullion in recent days, with the metal enjoying a five-day rally as investors sought out traditional safe-haven investments.

The UK's House of Commons will debate whether Britain should be involved in military strikes on Syria later today.

A revision to the US gross domestic product reading for the second quarter of the year is expected to take the figure to 2.2 per cent, up from the previous estimate of 1.7 per cent.

The US Labor Department is also predicted to reveal that the number of Americans making initial claims for unemployment benefits dropped last week.

So far this year, bullion has declined by 16 per cent on the back of speculation the Fed will cut its monetary stimulus before the end of the year.

Gold for december delivery fell by 0.7 per cent to $1,409.40 per ounce on the Comex in New York.

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