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Gold tumbles $30 as market sentiment improves

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Investing.com -

Investing.com - Gold kicked off the week with hefty losses on Monday, as investors regained their bullishness and moved back into riskier assets.

Gold for April delivery on the Comex division of the New York Mercantile Exchange fell by as much as $31.30 to hit an intraday low of $1,208.10 a troy ounce before paring some losses to trade at $1,213.50 by 13:35GMT, or 8:35AM ET, down $25.90, or 2.09%.

Trading volume is expected to lighter than usual as U.S. trading is closed for the President's Day holiday.

Prices of the yellow metal soared to a one-year high of $1,263.90 last Thursday, boosted by a flight to safety. Futures jumped $65.60, or 7.02%, last week, the best weekly performance since December 2008.

Gold has been well-supported in recent weeks amid indications global economic and financial headwinds could make it tough for the Federal Reserve to raise interest rates as much as it would like this year.

Market participants have all but priced out any rate hikes this year, while the Fed is anticipating four more. A gradual path to higher rates is seen as less of a threat to gold prices than a swift series of increases.

Gold is up nearly 14% so far this year as investors seek safe havens in the face of mounting instability in other financial markets.

In the week ahead, market players will be turning their attention to Wednesday's minutes of the Fed's latest policy meeting for fresh indications on whether the U.S. central bank will raise interest rates at all this year.

Investors will also be looking ahead to U.S. data on inflation for further clues on the strength of the economy.

Elsewhere in metals trading, copper futures rallied as the latest trade figures out of China reinforced the view that the economy remains in the midst of a gradual slowdown which will require Beijing to roll out more support in coming months.

The Asian nation is the world's largest copper consumer, accounting for nearly 45% of world consumption.

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The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.


The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

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