FXstreet.com (Barcelona) – The gold bullion is enduring heavy selling pressure today, as economic optimism coupled with caution regarding the metals demand weigh on sentiment. The most active contract for February delivery has dropped to a low of $1358.10 a troy ounce most recently, and remains vulnerable to further losses before close.
Gold along with commodities in general dropped earlier today following the PBOC’s announcement of a 0.50% increase in China’s reserve ratio requirement. Monetary tightening has investors worrying about demand for the yellow metal in the Asian giant, as the central bank tries to get a hold on inflationary pressure.
Further playing on the price of gold is what seems to be robust signals regarding economic recovery in both the US and the core of Europe, weakening the demand of safe-haven alternatives. Successful bond auctions in periphery nations this past week has also helped to ease eurozone sovereign debt concerns.