Daily Gold Update

Source: Marketwatch

San Francisco— Gold futures on Monday ended at their lowest since late July, adding to last week�s dramatic drops as investors hedged against a possible global liquidity crunch and reacted to increases in margin requirements for gold. Gold for December delivery declined $45, or 2.7%, to end at $1,594.80 an ounce on the Comex division of the New York Mercantile Exchange, the lowest settlement since July 21. Silver, which had wavered between gains and losses earlier, closed lower, with the December contract off 13 cents, or 0.4%, to settle at $29.98 an ounce, the lowest finish for silver since Feb. 7.

�Short term, there�s clear demand destruction in gold derivatives right now,� said Adrian Ash, head of research at BullionVault.com, in emailed comments. �The dollar and Japanese yen rally also continues to hurt gold prices,� said Ash. And �gold tends to fall when other investments � shares, bonds, even cash � offer a better opportunity.� Despite the recent steep losses, gold�s run may not be over for the year, analysts said. Gold is up 13% so far this year, and has notched yearly gains for the past decade. �It�s hard to see this drop as the end of gold�s 10-year bull market because everything else looks just as bad today as it did last month,� BullionVault�s Ash said. See full story.