Gold slumps to 3-week low

09:50, June 14, 2011      

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Gold futures on the COMEX Division of the New York Mercantile Exchange further declined on Monday, closing at the lowest level in three weeks. Other commodities also suffered corrections amid concerns over global recovery.

The most active gold contract for August delivery further dropped 13.6 U.S. dollars, or 0.89 percent, to 1,515.6 dollars per ounce.

Market analysts said that gold was wearing its inflationary support, as investors pushed inflation concerns to the back burner amid fears of an economic slowdown, and it's too early for gold to gain on safe-haven buying related to the downdraft.

Besides, Mike Daley, a senior gold analyst with PFGBest, said that worries over rise in China's interest rate also contributed to Monday's weak sentiment, as investors continue to watch closely on the country's inflation level. China is to release a slew of indicators this week, including its consumer prices, retail stales and industrial production reports.

Most commodities were down Monday, following steep declines Friday on concerns about the global economy. In the U.S., upcoming data include reports on retail sales, industrial production and inflation numbers.

Monday's settlement was the lowest for the most-active gold contract since May 23. Before that, gold registered a 0.9-percent drop in the previous week.

Silver for July delivery slumped 1.59 dollars, or 4.38 percent, to 34.737 dollars per ounce. Platinum for July delivery lost 26.2 dollars, or 1.43 percent, to 1,806.8 dollars per ounce.

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