Gold futures tumbled the most in more than four months to below $1,700 an ounce as U.S. payrolls in October rose more than forecast, easing pressure on the Federal Reserve to expand monetary stimulus.
A government report showed a net 171,000 workers were hired after a 148,000 gain in September that was more than estimated. The dollar headed for the biggest gain since July 20 against a basket of currencies, eroding the appeal of gold as an alternative investment.
“People are concerned that easy money will not be available for long since the economy is showing some signs of recovery,” Frank McGhee, the head dealer at Integrated Brokerage Services LLC in Chicago, said in a telephone interview.
Gold futures for December delivery tumbled 2.3 percent to settle at $1,675.20 at 1:49 p.m. on the Comex in New York, the biggest drop for a most-active contract since June 21. Earlier, the metal touched $1,674.80, the lowest since Aug. 31.
This week, gold fell 2.1 percent, the fourth straight decline and the longest slump since September 2011.
Gold reached a 10-month high approaching $1,800 on Oct. 5 on speculation that fiscal stimulus in the U.S., Europe and Japan enhanced the appeal of the metal as an alternative to currencies.
Silver futures for December delivery plunged 4.3 percent to $30.857 an ounce in New York, the biggest fall since June 21. Earlier, the price touched $30.815, the lowest since Aug. 30.
Platinum futures for January delivery fell 1.8 percent to $1,544.90 an ounce on the New York Mercantile Exchange.
Palladium futures for December delivery slumped 2.1 percent to $599.65 an ounce.
To contact the reporters on this story: Debarati Roy in New York at email@example.com;
To contact the editor responsible for this story: Steve Stroth at firstname.lastname@example.org