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Meanwhile, in India, the world's second biggest gold buyer, where the wedding season is looming, the Reserve Bank of India unexpectedly eased rules forcing importers to sell 20% of shipments to jewellers for re-export. The decision to remove restrictions surprised markets that, on the contrary, had expected tighter rules being introduced.
The end of gold controls, implemented in July last year, will return domestic demand to normal levels of around 800-900 metric tons annually, according to the Indian Bullion and Jewellers Association. 5 million weddings every year boost demand for gold in India, with average purchases for a wedding being at around 200 grams. Imports by India, which make up 25% of global demand last year, rose to 150 tons in October, the highest level in the year starter in April 1.
Data from Australia and Britain to influence Gold price on Tuesday
The beginning of the new week and month is likely to be marked by lack of important fundamental news from US and the Eurozone. At the same time, markets will closely watch events, which are due to happen in Australia and the UK. The Reserve Bank of Australia will announce interest rates, which will most probably remain unchanged at 2.5%. Besides that, the UK construction PMI will show activity changes in this sector of British economy.{ATTACHMENT}
XAU/USD to decrease trading range by the end of 2014
The long-term outlook for the XAU/USD cross remains bearish, taking into account the recent US dollar's bullish tendency across the market. It seems that the Gold is entering a descending triangle pattern against the Buck, meaning that trading range o the pair is likely to decrease. From above the long-term downtrend line is located around $1,220, while a support in face of 2014 low is placed at $1,131. In the first week of December we can expect the Gold to rise up to the trend-line; however, later we would suggest the metal to decline, especially if more optimistic fundamental news are released across the world.Daily chart
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Concerning the latest developments of Gold's price, the bullion for immediate delivery dropped 2.1% to $1,142.88 an ounce in the end of the trading session on Friday, reaching the lowest level since November 7, when it fetched four-year low of $1,132.16. Gold has lost 17% since reaching the peak in March, while investor holdings of exchange-traded products are near a five-year low. In the nearest future we predict the price to reach the 2014 low at $1,131 and then bounce back to trade slightly to the north.
Hourly chart
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