Gold prices were down more than 2% Thursday morning after nearly touching $1,700 an ounce in the wake of a second increase in margin requirements to trade futures contracts from the Chicago Mercantile Exchange.
SPDR Gold Shares (NYSEArca: GLD) slipped 2.7% in premarket trading. Investors pulled $1.6 billion from the largest gold ETF on Wednesday, IndexUniverse reported, taking its two-day net outflows to about $3 billion. [ETF Spotlight: GLD]
Gold held in exchange traded products fell for a fourth day on Wednesday and the most since January, according to Bloomberg. Holdings slid 26.9 metric tons to 2,154.7 tons after gold ETF assets reached a record earlier this month, according to the report.
“Investors have cashed in scorching gains in the metal ahead of a widely awaited central bankers’ meeting at Jackson Hole, Wyoming, as speculation grows over whether or not the Federal Reserve will signal a further round of U.S. monetary easing,” Reuters reported. [Gold ETFs Await Bernanke]
Earlier this month, CME boosted margins on gold contracts by 22%. [Gold ETFs Back on the Move After Margin Hike]