Many commodities dropped amidst the ongoing fallout from the 9.0 Richter Scale earthquake in Japan, the subsequent tsunami and the resulting nuclear crisis, all of which decreased demand for raw materials. Since setting an all-time record of $1,444.95 per troy ounce early last week, the precious metal has lost more than 2 percent of its value.
"There could potentially be large volumes of liquidation emerging over the coming weeks as physical holdings are liquidated to generate cash," according to a report by TheBuillionDesk.com analyst James Moore. The report noted "dips in gold and silver are still likely to be viewed favorable as a bargain-hunting opportunity as investors continue to diversify into safe-haven assets."
Just prior to 8 a.m. on Tuesday, gold futures were down 1.89 percent, a $27 dive to $1,397.90 per troy ounce.
"Gold and other precious metals are coming under pressure as commodities decline across the board," Chae Un Soo, a Seoul-based trader at KEB Futures, told the news service. "The decline in commodities also coincided with the need for gold to take a breather after a recent rally to a record."
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