Hedge Fund Gold Wagers Dropped to Its Lowest Since 2007

buying gold bar

(Bloomberg) – Hedge funds are the least bullish on gold since 2007 as clues of much quicker U.S. economic growth boost the case for the Federal Reserve to taper stimulus and slash demand for haven assets.

The net-long position in gold dropped 16% to 26,774 futures and options in the week completed Dec. 3, the smallest since June 2007, U.S. product Futures swapping Commission facts and figures show. Short wagers increased 6.2% to 79,631, inside 0.6% of the record reached in July. Net-bullish wagers over 18 U.S.-traded commodities ascended to a four-week high. The benchmark & Poor’s GSCI measure of 24 raw components capped the biggest every week gain since August as much quicker financial growth increased prospects for energy, metals and kernels consumption.

Gold is heading for the large-scale annual downturn in 3 decades as equities advance and inflation lower. The U.S. job loss rate reached a 5-year low in Nov. ember, and third-quarter economic improvement exceeded analyst approximates, government accounts displayed last week. The share of economists predicting the Fed will taper bond buys this month increase two-fold after the occupations report Dec. 6. Bullion come to a record in September 2011 as the Fed propelled more than $2 trillion into the financial scheme.

Sameer Samana, a St. Louis-based strategist at Wells Fargo Advisors LLC, which oversees about $1.3 trillion of assets said “Gold is experiencing the flip side of some of euphoria that it had from 2009 to 2011,” and also added “People are experiencing purchasers’ remorse as they look for other places to try to shop worth. Until the market is more worried about inflation, gold will have a tough time getting traction.”