Gold fell below $1,200 on Friday to its lowest since August 2010 and is on track to record its worst quarter since at least 1968 on persistent worries over the US Federal Reserve’s plan to wind down its monetary stimulus.
Bullion has taken a beating since the beginning of last week – down 15 % or over $200 an ounce – after Fed Chairman Ben Bernanke laid out a strategy to wind down the bank’s $85 billion monthly bond purchases on the back of a recovering economy.
The lower prices have failed to boost physical demand in Asia, traditionally the biggest buyer of gold, and investors have continued to flee exchange-traded gold funds.
Spot gold reversed earlier gains and declined 0.6 % to $1,191.79 an ounce by 0150 GMT, having fallen to a three-year trough of $1,180.71 earlier. US gold fell almost $20 to $1,192.1.