VINACHEM

Gold declined from the highest levelin more than four months amid speculation that the crisis in Ukraine may be easing, and as investors weighed signs thatphysical buying in Asia slowed after the rally.

Bullion for immediate delivery fell as much as 1 percent to$1,336.59 an ounce, and was at $1,337.85 at 3:43 p.m. inSingapore. The metal reached $1,354.87 yesterday, the highestsince Oct. 30, as Ukraine said Russia threatened to seize itswar ships in Crimea. The 14-day relative strength index climbedyesterday above 70, signaling to those who study charts thatprices may be set to reverse. It was at 64.2 today.

President Vladimir Putin ordered troops back to bases afterdrills in western Russia, Interfax said today, citing spokesmanDmitry Peskov. Ukrainian Prime Minister Arseniy Yatsenyuk saidthat he remained a supporter of a diplomatic solution, accordingto comments to Germany’s Bild Zeitung. Gold declined as oil andgrains dropped, paring gains made yesterday after Russia seizedcontrol of the Ukrainian Black Sea region of Crimea.

“The current round of gains may retrace should the tensionin the Ukraine ease,” Victor Thianpiriya, an analyst atAustralia & New Zealand Banking Group, wrote in a note beforeprices retreated today. Gold probably extended losses after theInterfax report, Thianpiriya said in a separate e-mail.

In China, the largest consumer, volumes for the benchmark spot contract in Shanghai have been lower over the past fourdays than the two-week high reached on Feb. 25. While thestandoff between Ukraine and Russia boosted haven demand, assetsin the SPDR Gold Trust, the biggest exchange-traded productbacked by bullion, were unchanged yesterday for a fourth day.

Armed Conflict

Ukraine mobilized its army after Russian forces tookcontrol of the Crimean peninsula, raising the prospect of armedconflict. Diplomats are seeking to calm tensions, with U.S.Secretary of State John Kerry scheduled to arrive in Kiev today.

Gold advanced in February as concern the U.S. recovery maybe faltering and unrest in emerging markets including Ukraineboosted demand for a store of value. Bullion rallied 12 percentthis year, rebounding from the biggest annual loss in more thanthree decades, even as the Federal Reserve scaled back stimulus.

Data yesterday showed that manufacturing and consumerspending beat analysts’ estimates after Fed Chair Janet Yellensaid last week the central bank is “open to reconsidering” thepace of cutbacks in asset purchases should the economy weaken.The Fed, which next meets March 18-19, announced a $10 billionreduction to bond buying at each of its past two meetings,leaving purchases at $65 billion.

Futures Drop

Gold for April delivery declined as much as 1 percent to$1,336.60 an ounce on the Comex in New York, and traded at$1,338.50. Futures climbed to $1,355 yesterday, the highest fora most-active contract since Oct. 30.

Silver lost 0.8 percent to $21.2493 an ounce after earlieradvancing 0.4 percent. Platinum fell 0.7 percent to $1,448.75 anounce, while palladium lost 0.2 percent to $748 an ounce afterearlier climbing to $750.80, the highest since Jan. 20.

In South Africa, the three biggest platinum producers metwith the Association of Mineworkers and Construction Unionyesterday for talks to end a six-week strike that has depletedstockpiles built to weather the disruption.