Gold prices fell on Monday, posting their biggest one-day drop in five weeks as the dollar and stocks rallied on news Hillary Clinton would not face criminal charges over her use of a private email server.
The spot gold price was down 1.8 percent at $1,280.70 an ounce by 2 p.m. EST (1900 GMT). U.S. gold futures settled down 1.9 percent at $1,279.40 per ounce.
"It's risk on after the FBI said it won't be taking the email saga any further," said Warren Patterson, commodity strategist at ING. "Polls are showing Clinton in the lead."
Much of the focus in the gold market remains on the U.S. presidential election, analysts say. Voters go to the polls on Tuesday. “The U.S. presidential elections will remain the dominant topic on the gold market for the time being,” according to a Monday commodities report from Commerzbank. “If (Democrat) Hillary Clinton were to come out on top, the gold price would probably continue to fall as a Fed rate hike in December would then be fully priced in.” Citi Research late Friday suggested a Clinton victory could mean gold sells off to $1,225-$1,250 an ounce and then consolidates. Meanwhile, the bank says, a win by Republican Donald Trump could mean a knee-jerk rally to the $1,375-$1,400 area. “Similar to post-Brexit trading, we expect vols to tick higher and for asset market drawdowns to ensue, prompting a bid for gold irrespective of near term USD moves,” Citi says.
Reference: Kitco, Reuters
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