Wednesday, April 23, 2008

Concern grows over near-term gold outlook - Globe and Mail April 23

Gold futures for June delivery dropped just below $900 (U.S.) an ounce on the New York Mercantile Exchange, the lowest level since April 3, before recovering somewhat to close at $909, down $16.20 on a day when not only gold, but some other commodities also lost ground.

The slide in bullion prices is not particularly surprising, given that this is a traditionally weak period of the year for gold.

“History has shown that gold prices tend to decline as we move from spring into summer [and] this year, the seasonal drop-off in gold demand could be exacerbated by the intense food price inflation currently being endured around the world, and especially in emerging economies,” Myles Zyblock, chief institutional strategist at RBC Dominion Securities Inc., said in a report Wednesday.

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