Gold, silver tumble to four-year lows

Spot gold broke below $1,180 an ounce, a level bullion had held twice during its last two major sell-offs in June and December last year. It also briefly held the mark earlier this month until Friday's drop. The yen plunged to a near seven-year low against the US dollar on Friday, putting it on track for its worst day in 18 months, after the Bank of Japan shocked financial markets with an aggressive easing of its monetary policy. "The main reason for gold's fall is the strength in the dollar after the BoJ's desperate efforts to weaken the yen," said Jeffrey Sica, president and chief investment officer at Sica Wealth Management, which oversees $1 billion in client assets. "Gold could fall further in the short term as the dollar could rise more in the short term, but gold should eventually benefit as a hedge against the uncertainties and economic turmoil brought by central-bank actions," Sica said. Spot gold slid as much as 3 percent to its lowest since July 2010 at $1,161.25 an ounce in earlier trade. It was last down 2.8 percent at $1,165.50 by 12:12 p.m. EDT (1612 GMT). The metal breached important support levels at $1,200 and $1,180, where stop losses -- automatic sale orders -- were placed and was on track for a 5.3 percent drop this week, the biggest weekly decline since June 2013. US COMEX gold futures were down $33.50 an ounce at $1,165.10. Spot silver earlier fell 4 percent to its lowest since February 2010 at $15.76 an ounce and was poised for a fourth monthly drop in a row. It was down 3.1 percent at $15.88. Gold and silver were already facing some heat after the US Federal Reserve earlier in the week largely dismissed financial market volatility as factors that might undercut progress towards its unemployment and inflation goals. Reflecting bearish investment sentiment, holdings in the SPDR Gold Trust GLD, the world's largest gold-backed exchange-traded fund, fell 0.16 percent to 741.20 tons on Thursday, a six-year low. The market now closely monitors physical gold and silver demand among retail investors. Source: Arab News