Gold fell, trading near a five-year low, as Goldman Sachs Group Inc. said rising U.S. interest rates may lead to deeper losses.
Reports this week may show U.S. manufacturing expanded and payrolls increased, after the Federal Reserve signaled that it will probably raise borrowing costs this year as the labor market improves. Goldman in a report Monday reiterated that prices may fall below $1,000 an ounce, signaling a drop of about 9 percent.
Futures for December delivery fell 0.3 percent to $1,091.60 by 8:21 a.m. on the Comex in New York. The metal closed at a five-year low of $1,086 on July 24. Bullion for immediate delivery lost 0.4 percent to $1,091.53 in London, according to Bloomberg generic pricing.
Gold has fallen for the past six weeks in London, the longest run in a decade, as traders turned their back on the metal amid muted inflation and a resilient American economy. U.S. reports this week include manufacturing on Monday, factory orders Tuesday and the jobs data from the Labor Department on Friday.
The Fed, which has kept rates near zero since 2008, ends its next meeting Sept. 17.
After becoming bearish on gold for the first time since the U.S. government data begin in 2006, hedge funds and other money managers held a net-short position of 11,334 contracts as of July 28, according to Commodity Futures Trading Commission data. Investors are holding the least through bullion-backed exchange-traded products since 2009.
Silver futures declined 0.6 percent to $14.65 an ounce in New York. Platinum retreated 0.7 percent to $978 an ounce, while palladium gained 1 percent to $617.20 an ounce.