Gold extends losses after biggest tumble since 2016

Thursday, 17 May 2018 00:07 - - {{hitsCtrl.values.hits}}

London (Reuters): Gold prices continued to lose ground yesterday (16 May), falling to their lowest since December as the dollar rallied to 2018 highs and US bond yields sat near multi-year peaks.

The metal had suffered its biggest single-day loss since November 2016 when it fell 1.7% on Tuesday (15 May) after strong US retail sales data sent the dollar and yields soaring.

Gold’s declines were accelerated by technical selling as it crashed below its 200-day moving average and the psychologically significant level of $1,300 an ounce.

By 1227 GMT spot gold was down 0.2% at $1,287.61 an ounce, having gone as low as $1,286.20, its weakest since 27 December.

US gold futures for June delivery were 0.3% down at $1,287.

Gold is likely to fall to $1,275 by the end of June and $1,250 by the end of the year as US yields and the dollar strengthen, said Boele. That is below the $1,310-$1,360 range gold has inhabited since January.