The price of gold remained below $1,200 per ounce on June 28, after falling below that level for the first time since August 2010 in the prior trading session.
Gold remains weak
The Guardian reports that after plunging to as low as $1,180 an ounce on June 27, the precious metal staged a recovery and rose to slightly more than $1,200 an ounce on the next day. However, bullish sentiment surrounding the metal was not phased by the modest uptick.
Reuters reports that August gold was $8.50 per ounce lower at $1,203.10 on the Comex division of the New York Mercantile Exchange by 07:01 GMT. At this point in the trading session, spot gold was valued at $1,204.46 an ounce after plunging to as low as $1,180.71 earlier in the session.
The recent fall below $1,200 per ounce comes as the metal has not had a good 2013. Gold has plunged so far this year, falling into a bear market in April 2013, as defined by plummeting 20 percent from its recent high.
Various market experts have had to revise their predictions as a result of the sharp declines in the price of the metal, according to The Guardian. For example, investment bank Goldman Sachs recently cut its forecast for the commodity, predicting that by the end of next year, it will drop to roughly $1,050 per ounce.
Goldman is not the only firm that has reduced its forecast for the metal, as Standard & Poor's has lowered its prediction for the commodity to $1,200 an ounce, the media outlet reports.
Losses in recent months have been particularly sharp, as data provided by Reuters indicates that for the April-June period, the precious metal is down 25 percent. The media has been collecting data on these figures since 1968, and if gold finishes Friday close to its current three-year low, it will result in the commodity registering its weakest weekly performance since 1983, and its poorest quarterly performance since the media outlet began recording this information.
The sharp declines present a stark contrast to the robust appreciation that gold has had over the last 12 years, as it enjoyed annual gains from 2000 to 2012. The metal surged from less than $300 per ounce in 2000 to more than $1,900 an ounce in late 2011.
However, it would seem as if the tide has turned. Julian Jessop, chief economist at Capital Economics, has told The Guardian that the various factors that previously served to push the metal higher in value have changed direction.
"Everything that had been driving gold up has gone into reverse," he told the media outlet. "Gold's own status as a safe haven has been undermined by the recent weakness and volatility in prices, at the same time as the markets are regaining confidence in the US dollar."
One major factor that has been cited in recent weeks as being bearish for gold is the speculation surrounding the Federal Reserve's future use of quantitative easing. Ben Bernanke, chairman of the central bank, stated in a recent press conference that these bond buying measures could be lowered in 2013 and eliminated completely in 2014. This statement caused asset markets to plunge in value.
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