Gold falls to near 4-month low; posts sharp weekly drop
NEW YORK/LONDON: Gold fell almost 1 per cent to a near four-month low on Friday, extending its losing streak a fourth consecutive day, weighed down by book squaring ahead of month end and selling by commodity funds.
For the week, gold lost about 3.5 per cent for its worst decline since late November 2013. Heavy technical selling throughout the week sent bullion prices below $1,250 for the first time since Feb. 4.
"It's the end-of-the-month position clearing," said COMEX gold options floor trader Jonathan Jossen.
Some hedge funds are forced to sell commodities to raise cash to pay for losses in their bearish bets against the rallying US government bond prices, Jossen added.
Analysts noted a breakdown of gold's usual inverse correlation with US bond yields. Yields on 10-year US Treasuries fell sharply this week to hit their lowest in 11 months.
Spot gold was down 0.7 per cent at $1,247.10 an ounce by 3:22 p.m. EDT (1922 GMT), having earlier hit a low of $1,241.99, its lowest since early February.
US gold futures for August delivery settled down $11.10 an ounce at $1,246.
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