Gold dipped below $4,000 an ounce after China ended a long-standing tax rebate for some retailers, a change that could weigh on demand in one of the world’s largest precious-metals markets.

Bullion for immediate delivery fell as much as 1% before paring most of that intraday loss, as Chinese jewellery stocks tumbled. Beijing announced Saturday that it would no longer allow some retailers to offset a value-added tax when selling gold they bought from the Shanghai Gold Exchange and Shanghai Futures Exchange, whether sold directly or after processing.

The precious metal surged to a record high in October, aided by a retail buying frenzy, before dropping sharply in the final two weeks of the month. Prices are still up by more than 50% year-to-date even after the pull-back, with many of the f

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