Gold hovered near three-month lows on Monday as investors chose cash over safe-have assets as the US fiscal impasse remained unresolved, while large sell orders rattled market sentiment. Spot gold ticked up 0.02 percent to $1,272.85 an ounce by 0635 GMT after falling 1 percent on Friday when large sale orders in New York futures prompted a near $30 drop in prices in about three minutes and a brief trading halt.
Gold has fallen for the past four sessions. "People are worried about the US situation and their first reaction is to hold cash and only then they look at safe haven assets like gold," said one Hong Kong-based precious metals trader. "That is why if the US doesn't find a solution, gold will be sold initially."
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