Gold Tumbles 4.4% as Dollar Rallies – 2/4/2010

by Bullion Prices Staff on February 4, 2010

New York precious metals plunged on Thursday after worries resurfaced over debt, US unemployment and other economic news propped up the greenback. Commodities and stocks were pulverized. New York daily bullion figures follow:

  • Gold for April delivery plunged $49.00, or 4.4 percent, to $1,063.00 an ounce. The yellow metal ranged from $1,060.40 to $1,112.00.

  • Silver for March delivery plummeted 96.7 cents, or 5.9 percent, to close at $15.350 an ounce. It ranged from $15.330 to $16.415.

  • April platinum tumbled $60.90, or 3.9 percent, to end at $1,515.30 an ounce. It ranged from $1,504.60 to $1,573.30.

In PM London bullion, the benchmark gold price was fixed earlier in the North American day to $1,083.25 an ounce, which was a decline of $32.00 from Wednesday. Silver fell 66 cents to $16.130 an ounce. Platinum was settled at $1,083.25 an ounce for a loss of $29.00.

"The whole Greek thing is freaking people out," Matt Zeman, a metals trader at LaSalle Futures Group in Chicago, said on Bloomberg. "People are getting more worried about the sovereign-debt defaults. They’re bailing out of everything and flocking to the safe-haven status of the dollar."

"There is not a lot of technical support in gold right now. It is more of a function of how the market reacts to whatever stimulus is forcing the market lower right now," Scott Meyers, senior analyst at Pioneer Futures, a unit of MF Global, said on Reuters.

"Bullion prices opened Thursday’s session with losses across the board, as the commodities’ complex felt the pressure from the dollar’s gains," wrote Jon Nadler, senior analyst at Kitco Metals, Inc. "This morning’s jobs report was definitely not the type that the markets expected, and although there was one little bright spot in the market, courtesy of increased US productivity numbers for Q4, the Dow futures did not take this morning’s statistics very well."

New York crude-oil for March delivery declined $3.84, or 4.9 percent, to close at $73.14 a barrel. It was the biggest daily decline since late July. Gold, considered a hedge during times of high inflation and economic uncertainty, tends to follow oil and move opposite to the U.S. dollar. A rising greenback makes dollar-denominated commodities, like bullion, more expensive for holders of other world currencies.

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