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Global stocks, gold and bond prices slip on talk of ECB taper

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Asian shares and gold retreated on Wednesday and bond yields were near two-week highs as markets were rattled by a media report flagging the possible withdrawal of the European Central Bank’s bond buying program.

European markets are also poised for a subdued start, with spreadbetters expecting Britain’s FTSE 100 to open as much as 0.2 per cent lower, Germany’s DAX to begin the day down 0.5 per cent and France’s CAC 40 to be off as much as 0.7 per cent.

MSCI’s broadest index of Asia-Pacific shares outside Japan slipped 0.4 per cent. Japan’s Nikkei closed up 0.5 per cent, aided by a weaker yen.

China markets are closed for the National Day holiday.

Bloomberg reported on Tuesday that the European Central Bank (ECB) would probably wind down its 80 billion euro (£70.91 billion) monthly bond purchases gradually before ending its quantitative easing program; citing unnamed officials at euro zone countries’ central banks.

ECB media officer Michael Steen later tweeted that the central bank’s decision-making body has not discussed reducing the pace of its monthly bond buying.

Rates will remain low until inflation gets up to the ECB’s target, ECB chief economist Peter Praet told bankers on Tuesday.

Paul

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