Gold recovers, but still heading for third-straight year of losses

The last time the yellow metal dropped in value for three consecutive years was between 1996 and 1998, and experts say prices will fall even further.

Anticipation that the Fed would move in December, rather than March 2016, prompted analysts at Barclays to lower their fourth-quarter gold price forecast 6% to $1,100 an ounce and cut their 2016 gold price prediction 13% to $1,054 an ounce, they said.

Chart courtesy of Kitco.com.

Gina Sanchez, of Chantico Global, also believes the weakness in gold will continue. In an interview Friday on CNBC’s Trading Nation, she said she expected the trend to remain in place for some time:

“Gold hates a recovering economy, gold hates higher interest rates and gold hates a stronger dollar and those are all three things we can expect.”

Investors have been selling from bullion-backed funds at the fastest pace in three months as speculation that the Federal Reserve will lift U.S. interest rates next month is making the metal less attractive because it doesn’t pay interest and costs money to hold.

But some buyers returned Monday on the belief prices have dropped so much that gold is now a bargain. A weaker dollar also boosted gold’s allure.

The most actively traded contract, for December delivery, was up $1.60, or 0.2%, at $1.089.30 a troy ounce around noon on the Comex division of the New York Mercantile Exchange.

Other metals traded lower, with January platinum leading the pack, down $24.10 or 2.6% to $916 an ounce. December palladium lost $12.55, or 2.15, to $600 an ounce. December copper traded at $2.239 a pound, less than half a cent down.