After boosting bets on higher gold prices, hedge funds may hesitate from buying more of the metal on expectations for higher U.S. interest rates and unless the standoff between Russia and the West intensifies, UBS AG said.
Coutts & Co. is adding gold for investors as rising wealth in China and increasing political risks including in Ukraine spur demand, helping prices rally from the biggest annual decline in more than three decades.
Gold held a decline from the highest level in more than two months as the U.S. Federal Reserve was expected to trim stimulus just as physical demand in Asia slows before the Lunar New Year. Platinum snapped a three-day drop.
Gold rose for the first time in three days in London on Bangladesh’s purchase of 10 metric tons of bullion from the International Monetary Fund and on speculation that the earlier declines will spur physical demand.
The plunge in gold to an almost three-year low has failed to lure shoppers in India, the world’s largest consumer, as state curbs and a decline in the rupee to a record bolster the costs of imported metal.