Gold, Platinum Hit 8-Month Low On $US
Spot gold touched $801.90 an ounce, its lowest level since late December, and was at $816.50/817.45 at 1433 GMT compared with $819.25/820.85 late in New York on Monday.
The precious metal is down more than 20 per cent since hitting a record high of $1,030.80 on March 17.
“The speed and severity of the dollar’s run higher has resulted in some long liquidation,” said Daniel Hynes, analyst at Merrill Lynch.
“At the moment it is hard to see an end to it, but we still have some supportive factors such as inflation, geopolitical tensions and falling mine supply.”
Prices of the metal attempted a recovery earlier on Tuesday after the dollar slipped on profit-taking. Also under heavy selling pressure was industrial metal platinum used to make autocatalysts. Investors have been selling their holdings on concern about falling demand from car makers.
The bulk of the world’s platinum is used by automakers in autocatalyst systems that scrub exhaust fumes of dangerous and environmentally damaging chemicals.
Spot platinum fell to $US1,462.50 an ounce, the lowest since the middle of December, and was last at $US1,492/1,512 from $US1,517/1,537 an ounce on Monday.
However, the dollar was still hovering near a 6-month high against a basket of major currencies as investors looked beyond US growth worries to a slowing global economy.
A stronger US currency makes commodities priced in dollars more expensive for holders of other currencies.
Oil hit $112.48 a barrel, the lowest since early May as the market focused on events in currency markets and the International Energy Agency predicted higher supplies.
“It looks like sentiment towards gold has turned negative, we’re seeing long liquidation on the back of both dollar movement and the oil price movement,” said Suki Cooper, analyst at Barclays Capital.