Gold suffers biggest one-day drop since 1980s

CHICAGO, April 15 (Xinhua) -- Gold futures on the COMEX division of the New York Mercantile Exchange suffered their biggest one-day decline since the 1980s on Monday, as the metal extended its dive into a second straight session and pushed further into bear-market territory.

The most active gold contract for June delivery tumbled 140.3 dollars, or 9.27 percent, to settle at 1,361.1 dollars per ounce. The closing level was the lowest for a most-active contract since February 2011, according to FactSet data.

Prices saw their biggest one-day percentage drop since February 1983. Gold's one-day dollar drop was the biggest since January 1980 and the second largest in its history.

Gold tumbled below 1,400 U.S. dollars an ounce, after dropping into a bear market last week as optimism that a U.S. recovery will curb the need for stimulus cut demand for a protection of wealth, as well as fears of central bank gold sales from Europe, prompted by a proposed sale of Cyprus bullion holdings, according to market analysts.

Holdings in the SPDR Gold Trust, the biggest exchange-traded product backed by the precious metal, are the lowest in almost three years and hedge funds have cut bets on higher prices by 72 percent since mid-October. Holdings in the SPDR Gold Trust were at 37.3 million ounces as of Friday, down from 39.1 million on April 1, according to reports.

The metal climbed for a 12th year in 2012 as nations pledged more stimulus to bolster growth. Gold prices are down 18 percent this year as some US Federal Reserve policy makers favor pulling back this year on 85 billion US dollars in monthly debt-buying and as U.S. equities reached a record.

Given that backdrop, silver for May delivery fell 2.97 dollars, or 11.28 percent, to close at 23.361 dollars per ounce.

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