Gold on Tuesday suffered its worst trading day in 17 months after a recovery in the value of the US dollar and seven-year highs for yields on the country's government bonds.
The most active gold futures contract on the Comex market in New York dropped to a low of $1,288.20 an ounce, down over 2% or more than $28 an ounce compared to Monday's settlement. Volumes were massive with 43m ounces of June delivery gold traded by early afternoon. Today's performance was the sharpest decline since mid-December 2016 when gold gave up $33/ounce, trading at $1,127 per ounce.
The price of gold and the US dollar usually move in the opposite direction and the greenback bounced back on Tuesday with the index against the country's major trading partners recovering to 93.2. The US dollar's all-time peak of 164.7 was reached in February 1985. That coincided with a bottom in the price of gold of $284.25 an ounce...