Gold stumbles from all-time high as risk appetite returns

08:41, June 22, 2010      

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Gold futures on the COMEX Division of the New York Mercantile Exchange dropped after hitting a fresh intraday high on Monday, as China's announcement that it would allow more flexibility in its yuan exchange rate fueled investor's risk appetite. Silver dropped, but platinum climbed.

The most active gold contract for August delivery plunged 17.6 dollars, or 1.4 percent, to finish at 1,240.7 U.S. dollars.

Chinese government announced over the weekend that it would allow greater flexibility in the yuan's exchange rate, which boosted the global stocks markets and fueled investor's risk appetite, reduced some demand for the safety of gold.

Gold surged to 1,266. 5 dollars per ounce earlier in the session, surpassing the record intraday high of 1,263.70 dollars per ounce set in the previous session. The surge in gold price and the rally in stocks markets encouraged investors to take profits and switch fund out of the metal and into the stocks market as well as currencies perceived riskier.

July silver was down 37.6 cents, or 2.0 percent, to settle at 18.808 dollars per ounce, July platinum rose 3.3 dollars, or 0.2 percent, to settle at 1590.3 dollars per ounce.



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