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Gold Prices Down, Set for Biggest Drop in 2 Weeks

Wednesday, 1 May 2013 | 3:01 PM ET
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Gold settled almost 2 percent lower on Wednesday, the biggest daily drop since its historic decline in mid-April, as investors sold off a range of commodities.

Silver dropped 4 percent and platinum group metals fell around 2 percent, tracking sharp losses in industrial commodities led by crude oil and copper.

Signs of slowing manufacturing growth both in the United States and China weighed down on demand hopes for industrial commodities and hit gold's inflation-hedge appeal.

Still, bullion has recovered more than half the $225-per-ounce loss it incurred between April 12 and 16, driven by strong physical demand around the world especially in top bullion consumers China and India.

"Some of those out-of-control retail buying has now been satisfied,'' said Frank McGhee, head precious metals trader at Integrated Brokerage Services LLC.

Physical buying also slowed down due to holidays in China and parts of Europe due to the Labor Day holiday.

  Name Price   Change %Change Volume
GOLD
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GOLD/USD
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SILV/USD
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SILVER
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PALL/USD
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PLAT/USD
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Spot gold last fell 1.1 percent to $1,460.01 an ounce, on track for its biggest one-day drop since April 15 when it lost 8.5 percent.

U.S. gold futures ended $25.90 lower at $1,446.20 an ounce. Turnover was light given gold's sharp sell-off. Trading volume at 11:31 a.m. was less than 115,000 lots, on track to finish below the 30-day average at 232,300, preliminary Reuters data showed.

Among other precious metals, silver fell 1.8 percent to nearly $24 an ounce. Platinum dropped 1.8 percent to $1,476 an ounce, while palladium was also down 1.3 percent to $686 per ounce.

  Price   Change %Change
GLD
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SILV/USD
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PLAT/USD
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PALL/USD
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PALL/USD
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