Gold falters with markets Tuesday
New York City, NY, United States (AHN) – Gold prices tumbled Tuesday along with world markets as Greece’s political and economic woes weighed on investors across all sectors.
The board based declines in U.S. and global equities spilled over to the yellow metal, pushing gold prices below $1,600 intra-day.
Market participants fear that new elections could be held in June if no coalition Greek government is formed. Worries are growing that the ailing Mediterranean country could be coming closer to a default and may be forced out of the euro zone.
Often viewed as and held as a safe haven, gold provided no respite Tuesday as investors sold whatever they were holding to raise cash.
Also pressuring gold prices of late is the lack of speculative buyers. The only significant buyers of the precious metal in recent months have been central banks.
In addition, India, gold biggest buyer, has seen waning demand due to a weaker economy and proposed tax on gold sales.
While gold prices are currently under pressure, industry analysts note that the underlying support and fundamental reasons for buying the commodity are still sound, notably mega-loose monetary policies, and will provide a cushion and eventually keep the metal from falling much further.
Just after 1:30 p.m., June future contracts for gold were lower by $40.10 at $1,599 a troy ounce.