Gold hunkered near its weakest since early 2014 on Tuesday, in the midst of its longest losing streak in seven months, as rallying stock markets diverted interest from safe-haven bullion.
Ahead of the latest European Central Bank policy meeting and key U.S. data this week, prices have fallen sharply since last week after breaking through $1,285 an ounce, the lower limit of a range they had kept to for much of the previous month. They hit a low of $1,240.69 an ounce earlier on Monday, their weakest since late January.
The ECB is tipped to announce a package of policy options after its meeting on Thursday, following heavy hints that monetary policy will be loosened in a variety of ways to support growth.
The following day sees the release of monthly U.S. non-farm payrolls data, a leading barometer of the health of the world's largest economy. Both events will be closely watched by gold traders for their impact on currencies and U.S. monetary policy. Looser monetary policy, which cuts the opportunity cost of holding non-yielding gold, is generally positive for bullion prices. However, this will likely be outweighed by the currency impact of a weaker euro, analysts say.
Reassuring Chinese factory data and another record high for Wall Street lifted world stocks on Monday, diverting interest from gold. European shares started the month positively, rising 0.2 percent.
Physical buying failed to pick up as consumers expect gold prices to fall even further. In top buyer China, banks are also adequately stocked from last year's record imports, leaving them to focus on selling existing stocks first.
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