Gold drops to 3-month low

08:31, January 26, 2011      

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Gold futures on the COMEX Division of the New York Mercantile Exchange on Tuesday dropped to a 3- month low, as gold's appeal of safe haven eroded amid optimistic economic outlook around the world.

The most active gold contract for February delivery shed 12.2 dollars per ounce, or 0.9 percent, to settle at 1,331.2 dollars, the lowest level in three months.

Market traders noted that global investors are becoming more confident about the economic outlook, which has reduced the gold's appeal as safe-haven investment.

Upbeat earnings reports from companies such as U.S. industrial bellwether General Electric, along with strong performance in leading European economies, have pushed down gold's price by almost six percent so far this month.

However, some analysts are still positive about gold, saying jobs are still a big issue and the housing market is still very soft and vulnerable, which would push gold back to its safe-haven status.

Silver for March delivery decreased 51.6 cents, or 1.89 percent, to 26.805 dollars per ounce. April platinum also shed 30.4 dollars, or 1.7 percent, to 1,784.2 dollars per ounce.

Source: Xinhua
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