(Updates prices, adds quotes)
By Lewa Pardomuan
SINGAPORE, March 20 (Reuters) - Gold dropped more than 2
percent to its lowest level in a month on Thursday amid a
broad-based sell off in commodities and as funds cashed in
after pushing the metal to a record above $1,000 an ounce this
week.
Platinum, palladium and silver also fell. New York's COMEX
gold futures fell over 3 percent to hit their lowest in more
than four weeks, while Shanghai futures sank by their 5 percent
limit.
Gold <XAU=> tumbled to as low as $920.30 an ounce, down
from $944.20/945.00 late in New York on Wednesday and off
Monday's record high of $1,030.80 an ounce.
"We have to see whether the funds will continue selling. If
they do, of course there is a possibility that it will go down
and test $900," said Ronald Leung, director of Lee Cheong Gold
Dealers in Hong Kong.
A smaller-than-expected U.S. interest rate cut was an
excuse for the funds to exit gold and the absence of Japanese
speculators also exaggerated movements, said Leung.
Gold tumbled 6 percent on Wednesday, its biggest one-day
percentage drop in nearly two years as funds exited
commodities, leading to declines in oil <CLc1>, base metals and
agricultural products. Trading was thin on Thursday as the
Tokyo Commodity Exchange was closed for a national holiday.
"The upshot is we hold our current view that gold prices
will fall over the next six months as the U.S. dollar firms and
oil prices fall," ANZ senior commodities analyst Mark Pervan
said.
"We forecast spot gold to fall to $850 an ounce by the end
of September before firming back towards $900 an ounce by end
of the year as oil prices bottom."
Gold futures for April delivery <GCJ8> on the COMEX
division of the New York Mercantile Exchange fell $8.2 an ounce
to $937.1 an ounce, after hitting a low of $915. The contract
struck a record of $1,033.90 on Monday.
"It is most probably liquidation on margin calls. It looks
like players are exiting the market after gold hit the $1,030
level and there's no reason for physical buyers to buy at high
levels," said a dealer in Singapore.
"Retailers are also starting to cash in. That's why I think
the market will still fall for another day. It's hard to say
where the support level is, but I think it's going to fall
below $900 today," he said.
The dollar firmed against the euro and came near 1-month
highs versus the Australian dollar on Thursday, underpinned by
sliding gold and oil prices, falling stocks and in spite of
investor anxiety over troubled credit markets. []
Spot platinum <XPT=> fell to $1,885/1,890 an ounce from
$1,900/1,910 -- off a record high of $2,290 hit on March 4.
Silver <XAG=> dropped to $18.12/18.17 an ounce from
$18.38/18.43 an ounce. Spot palladium <XPD=> fell to $447/454
an ounce from $455/460 an ounce.
The most active June contract <SHAUM8> on the Shanghai
Futures Exchange fell by 5 percent to 214.55 yuan a kilogram,
tracking declines in cash gold.
Precious metals prices at 0707 GMT
Metal Last Change Pct chg YTD pct chg
Turnover
Spot Gold 936.90 -6.60 -0.70 12.51
Spot Silver 18.11 -0.22 -1.20 22.61
Spot Platinum 1885.00 -15.00 -0.79 24.01
Spot Palladium 447.00 -8.00 -1.76 21.47
TOCOM Gold 3167.00 -1.00 -0.03 3.50
73151
TOCOM Platinum 6045.00 54.00 +0.90 13.22
24305
TOCOM Silver 635.60 2.70 +0.43 17.49
1215
TOCOM Palladium 1517.00 14.00 +0.93 12.29
9752
Euro/Dollar 1.5586
Dollar/Yen 99.06
TOCOM prices in yen per gram, except TOCOM silver which is
priced in yen per 10 grams. Spot prices in $ per ounce.
(Additional reporting by Nick Trevethan; Editing by Michael
Urquhart)
