Prices of Gold an ounce dropped below $1,200 which is a 5 month low at the time that the Federal Reserve pare down the economic stimulus that reduced that reduce the demand for haven assets.
The stimulus propped up the prices of gold to 70% from December 2008 to June 2011 as the Fed expanded its balance sheet through debt purchases that fueled expectations of accelerated inflation and a weaker dollar.
Bullion for immediate delivery is down by 1% to $1,205.98 an ounce by 10:31 a.m. in London after dropping as much as 1.5% to $1,199.63 an ounce, the lowest since June 28. Prices tumbled into a bear market in April and are heading for the first annual drop in 13 years, as investors lost faith in gold. Prices plunged as much as 38% since reaching a record $1,921.15 an ounce in September 2011.
Gold exchange-traded products lost $72.44 billion in value since the start of the year and mining companies wrote down at least $26 billion after investor appetite waned.
No comments:
Post a Comment