New York: Gold fell below $1,600 an ounce to a seven-month low on Wednesday, as rumours of a troubled hedge fund forced to liquidate positions triggered a selloff of commodities.
In what appeared to spark heavy losses in crude oil, gold tumbled 1.5% as traders cited talk that a large commodity hedge fund had been forced to dump its holdings.
Silver and platinum fell more than 2.5%, while Brent crude oil lost about 2%.
Gold selling accelerated after bullion slipped below $1,600 an ounce and completed a bearish technical formation known as a “death cross”, when its 50-day moving average broke below its 200-day moving average.
Analysts said some investors were selling gold due to jitters about upcoming minutes from a US Federal Reserve meeting in January. Minutes from the December meeting showed some policymakers had been mulling a lessening or complete withdrawal of Fed stimulus.
Spot gold was down 1.6% at $1,579 an ounce by 1:26pm EST (1826 GMT), having hit $1,578.06, its lowest since July.
US gold futures for April delivery were down $25.40 at $1,578.80 an ounce.
Silver fell 2.7% to $28.62 an ounce, platinum dropped 2.7% to $1,642, and palladium was down 3.3% at $736.47 an ounce. Reuters