Gold price tumbles to four-year low
Gold price tumbles to four-year low
Gold dived to US$1,167.41 per ounce, striking the lowest point since late July 2010.
LONDON: Gold slumped Friday (Oct 31) to the lowest level in more than four years, as investors took their cue from the stronger dollar and rebounding equities.
At about 0705 GMT (3.05pm Singapore time) on the London Bullion Market, gold dived to US$1,167.41 per ounce, striking the lowest point since late July 2010. Sister metal silver sank to US$15.99 per ounce, reaching a nadir last witnessed in February 2010.
Gold has fallen sharply after the US Federal Reserve announced Wednesday that it will end its quantitative easing (QE) stimulus, after six years of pumping easy money into the US economy via asset purchases to shore up growth.
"Gold has sunk further... as the Fed ended QE and signs of an improving US economy delivered the double whammy of strengthening the dollar, making the metal more expensive, and equity markets rallying, reducing the apparent need for a safe haven," said Mike van Dulken, head of research at trading firm Accendo Markets.
Gold is normally regarded by investors as a safe bet in times of economic turmoil.
Added to the picture, European stocks rallied on Friday, as investors welcomed the Bank of Japan's surprise stimulus boost.
"The BoJ's surprise announcement overnight provided the stock markets and the US dollar an extra push which reduced the appetite for the safe haven gold even more," noted analyst Fawad Razaqzada at trading site Forex.com.
The BoJ ramped up its vast monetary easing programme on Friday, in a shock move aimed at reviving growth just as the Federal Reserve winds down its own stimulus spree.
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