Gold tumbles on U.S. jobless data, dollar

08:31, January 21, 2011      

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Gold futures on the COMEX Division of the New York Mercantile Exchange suffered a major setback and settled at a two-month low on Thursday, as stronger-than-expected U.S. jobless data eroded gold's safehaven appeal. Silver and platinum both ended sharply lower.

The most active gold contract for February delivery lost 23.7 dollars, or 1.7 percent, to 1,346.5 dollars per ounce.

The U.S. Labor Department said Thursday that the number of U.S. workers filing new claims for unemployment benefits dropped 37,000 to a total of 404,000 in the latest week, while economist expected the claims would fall by 25,000, fueling investors'rising optimism about the U.S. economy.

Meanwhile, a series of stronger-than-expected economic data released on Thursday including the sales of existing homes also helped buoy investor confidence and push up the greenback.

A trader noted that gold lost momentum on Thursday as the market situation encourages even risk-averse investors to step up their risk appetite, eroding gold's appeal as a refuge investment. And the stronger dollar also accelerated gold's decline, as it made the dollar-denominated gold much more expensive for investors holding other currencies.

Silver futures for March delivery plunges 1.328 dollars, or 4.6 percent, to 27.473 dollars per ounce. April Platinum lost 19.5 dollars, or 1.1 percent, to 1818.6 dollars per ounce.

Source: Xinhua
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