Gold drops sharply as worries over hurricane, Korean Peninsula ease

Source: Xinhua| 2017-09-12 05:21:32|Editor: yan
Video PlayerClose

CHICAGO, Sept. 11 (Xinhua) -- Gold futures on the COMEX division of the New York Mercantile Exchange fell more than one percent Monday, as geopolitical tensions surrounding the Korean Peninsula eased and Hurricane Irma proved to be less destructive than initially predicted.

The most active gold contract for December delivery dropped 15.5 dollars, or 1.15 percent, to settle at 1,335.7 dollars per ounce.

Hurricane Irma, once a Category 5 hurricane, has weakened to a tropical storm after dumping rains across Florida over the weekend.

Meanwhile, the tensions over the Korean Peninsula seemed to be eased as no further actions were taken during the weekend, following a nuclear test conducted by the Democratic People's Republic of Korea (DPRK).

As a result, the U.S. stocks traded higher on Monday. The Dow Jones Industrial Average rose 240.58 points, or 1.1 percent, to 22,038.37 as of 1723 GMT. When equities post gains, the gold futures usually fall.

The U.S. dollar index, a measure of the dollar against a basket of other major currencies, rebounded 0.43 percent, to reach 91.87 as of 1712 GMT.

It had dropped to more-than-two-year low of 91.011 at one point last Friday, in response to the DPRK' s nuclear test.

Gold and the dollar typically move in opposite directions, which means if the dollar goes down, gold futures will rise as gold, measured by the dollar, becomes less expensive for investors. This had pushed the gold futures for December delivery to one year high last Friday at 1351.2 dollars per ounce.

As for other precious metals, silver for December delivery went down 22.1 cents, or 1.22 percent, to close at 17.902 dollars per ounce. Platinum for October fell 13.5 dollars, or 1.33 percent, to settle at 998.8 dollars per ounce.