SINGAPORE (Reuters) - Gold slipped in Asian trading on Tuesday after Standard & Poor's revised up the United States' credit outlook to stable from negative, hurting bullion's safe-haven appeal.
S&P's move stirred up more worries that the Federal Reserve could soon end its massive bond buying spree due to a string of positive economic data.
Gold, which is seen as a hedge against inflation and has been supported by the Fed's $85 billion monthly bond purchases, eased 0.3 percent to $1,382.56 an ounce by 0611 GMT, after posting a small gain in the previous session. Spot gold has fallen about 17 percent so far this year.
"The S&P news bodes well for the stock market more than precious metals," said Brian Lan, managing director of Singapore-based dealer GoldSilver Central Pte Ltd. "More funds are going towards the stock markets."
Gold should trade between $1,360 and $1,420 this week, Lan said, sticking to its recent range.
Silver, platinum and palladium tracked gold lower on Tuesday.
Global financial markets have been under pressure since Fed Chairman Ben Bernanke said last month that the Fed could decide to scale back buying at the next few meetings if the U.S. economy showed continued signs of strengthening.
St. Louis Fed President James Bullard on Monday expressed his support for sticking with the stimulus programme as inflation remained well below the Fed's 2 percent target.
PHYSICAL DEMAND EASING
Physical demand is cooling off from peak levels in April, when spot gold prices fell to a two-year low of $1,321.35. The drop set off a mad rush for bullion in Asia that pushed premiums higher amid a supply crunch.
Dealers in Singapore said with demand easing, gold bars and coins were easier to obtain.
Meanwhile, holdings in SPDR Gold Trust ticked higher, although they remain near four-year lows. The world's largest gold-backed exchange-traded fund said its holdings rose 0.3 percent to 1,009.85 tonnes on Monday.