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Gold Plunges Below $1,200 to Record Low in Three Years

June 27, 2013 at 21:49 by Vladimir Vyun

Gold fell today, reaching the lowest level in 34 months, as data from the United States continued to be good. Pending home sales jumped as much as 6.7 percent in May to the highest level since 2006. Unemployment claims retreated from 355,000 to 346,000 last week.

The positive indicators give scope for the US Federal Reserve to withdraw part of its monetary stimulus. Policy makers were attempting to downplay expectations of stimulus reduction, saying that an end to quantitative easing is likely far away and the economy is not ready to survive without accommodative policy. Such comments weakened the dollar somewhat, but did not help gold very much.

August futures for gold slumped as much as $29.8 (2.42 percent) to $1,200 per troy ounce as of 21:47 GMT on COMEX today. Previously, the metal touched $1,196.10, the lowest price since August 2010.

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