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Gold fell on Tuesday near two-week low amid speculation of an earlier than projected Quantitative Easing scale back after Standard & Poors improved its assessment for the worlds biggest economy.

On the Comex division of the New York Mercantile Exchange, gold futures for August delivery lost 0.65% on the day and stood at $1 376.95 a troy ounce at 7:18 GMT. Prices varied between a day low of $1 376.55 and high at $1 387.05 per ounce.

Gold for immediate delivery fell to $1 375.95 yesterday, after Standard & Poors upgraded the U.S. credit rating from AA+ negative to stable, one notch below the highest AAA rating, which the U.S. had two years ago. This spurred speculations whether Fed will scale back or even completely shut its monetary easing program earlier than expected.

The rating agency commented its assessment: “The stable outlook indicates our appraisal that some of the downside risks to our ‘AA+’ rating on the U.S. have receded to the point that the likelihood that we will lower the rating within the next two years is less than one in three. We do not see material risks to our favorable view of the flexibility and efficacy of U.S. monetary policy. We believe the U.S. economic performance will match or exceed its peers’ in the coming years. We forecast that the external position of the U.S. on a flow basis will not deteriorate.”

Gold lost around 16% of its value this year and 26% compared to September 2011 as the U.S. economy showed stable signs of recovery. Market players began to speculate about the future of Feds monetary stimulus, which has been the main factor to spur gold price fluctuations. The precious metal slipped 2.2% on Friday, June 7, as the Bureau of Labor Statistic reported that U.S. labor market has created more jobs than expected. Although the Unemployment Rate surpassed forecasts by 0.1% and stood at 7.6%, also 0.1% higher than last month’s figure, the Change in Non-Farm Payrolls indicator rose to 175 000, 12 000 more than the 163 000 projection and significantly above the revised 149 000 value for April.

Gavin Wendt, a director at Mine Life Pty. in Sydney commented gold sentiment for Bloomberg: “It’s in a holding pattern because the market’s looking for some kind of direction, what’s going to happen with the U.S. market, what’s going to happen with stimulus. Gold is still a great insurance policy.”

Elsewhere on the precious metals market, silver, platinum and palladium are tracking golds movement and mark daily losses. Silver futures for July delivery traded at $21.62 an ounce at 7:38 GMT, down 1.39% on the day. Platinum July futures lost 0.95% for the day and stood at $1 492.65 at 7:40 GMT. Palladium for September delivery traded at $763.70 per troy ounce, down 0.74%.

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