Gold prices fell for the seventh time in eight sessions on speculation that testimony by arms inspectors to the United Nations will support efforts to delay a US-led attack on Iraq to force the country to disarm.
Gold prices have dropped 7.3 percent from a six-year high on Feb. 4, halting a yearlong rally that was prompted partly by demand for the metal as a haven during war. Hans Blix, the UN's chief arms inspector, said that Iraq has failed to account for all its illicit weapons, even as the arms search proceeds without obstruction.
Gold for April delivery fell US$5.50, or 1.5 percent, to US$352.20 an ounce on the Comex division of the New York Mercantile Exchange, the lowest closing price since Jan. 15. Gold futures, which had reached a high of US$379.90, were 17 percent higher than at this time last year. The market closed early for the Presidents' Day holiday weekend.
The outlook for gold is "negative," said Ronald Daino, an analyst at Citigroup Inc's Salomon Smith Barney in New York, who uses historical price charts to gauge trends. The charts show a close below $350 an ounce for the April futures contract would prompt a further decline to US$342, he said.
The Philadelphia Gold & Silver Index of 11 mining companies dropped 2.37 to 72.15.
RSS