Gold drops as some investors sell amid US budget negotiations

Singapore. Gold today fell for the first time in five days as some investors sold the metal amid negotiations between US lawmakers to strike a budget deal before the year-end. Gold lost 0.4 per cent to 1,653.55 dollar an ounce. Bullion is 6 per cent higher this year, set for a 12th annual gain, as investors sought the metal as a protection of wealth after central banks around the world took steps to stimulate economies. Silver was little changed at 30 dollar an ounce, after swinging between gains and losses. The metal has climbed 7.8 per cent in 2012 as holdings in exchange-traded products rose 9.4 per cent this year to a record 18,915.13 metric tonnes. President Barack Obama and Congress return to Washington today and have five days to reach a deal to avert more than USD 600 billion in automatic spending cuts and tax increases from January 1, known as the fiscal cliff. Treasury Secretary Timothy F Geithner said he will take "extraordinary measures" to postpone a US default into early 2013 amid the stalled talks.