Hedge funds cut bullish gold bets, adding the most short contracts in four weeks, as U.S. economic growth fuels speculation the Federal Reserve will trim stimulus. Holdings across commodities dropped the most since April.
Gold swung between gains and losses in New York before settling little changed as investors weighed signs that the Federal Reserve will curb stimulus this month against the possibility of U.S. air strikes on Syria.
Speculators betting the commodities rally will continue into a third year are being confronted by currency investors wagering the dollar will strengthen in 2011. If history is any guide, the foreign-exchange market will win.