Forexpros – Gold futures remained sharply lower on Monday, down more than 1% as a broadly stronger dollar and concerns over sovereign debt loads in the euro zone and the U.S. weighed.
On the Comex division of the New York Mercantile Exchange, gold futures for December delivery traded at a three-week low of USD1702.95 a troy ounce during U.S. morning trade, tumbling 1.29%.
Earlier in the day, the spread between 10-year Spanish bond yields and their German counterparts widened as investors remained jittery despite the election of a new Spanish government, which was expected to implement drastic austerity measures.
Meanwhile, rating agency Moody’s said a rise in French government debt yields and weaker growth prospects could be negative for the outlook on the country’s credit rating.
In the U.S., a formal announcement on the failure of a U.S. congressional “super committee” to agree on a package of measures to slash USD1.2 trillion off the U.S. deficit over the next 10 years was expected later in the day.
Gold remained vulnerable on the risk that investors may have to liquidate their gold positions to cover losses elsewhere, since funding has become difficult as a result of market turmoil in recent months.
In Asia, physical demand remained muted as investors held off for lower prices as the near-term outlook remained unclear.
Elsewhere on the Comex, silver for December delivery plunged 3.97% to trade at USD31.13 a troy ounce, while copper for December delivery fell 2.81% to trade at USD3.307 a pound.
Silver’s losses came after official data showed that Chinese silver imports dropped 26% on the year in October and the total inflow in the first 10 months of the year dropped 28%.
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