U.S. gold futures declined by more than 1 percent for a second straight day on Wednesday.
Silver prices plunged 7.5 percent to below $40 an ounce after margin requirements were raised three times in a week. The metal registered its biggest three-day loss since 1983, according to Bloomberg.
"The big correction in silver kind of led the way, and that got people looking at commodities as a whole," Richard Ilczyszyn, a market strategist at Lind-Waldock, a broker in Chicago, was quoted on Bloomberg. "There seems to be a little reduction in risk globally. We’ve seen the equity market pull back, crude pull back, silver and gold. We saw a flood into Treasuries. That tells me people are looking for safety right now."
June gold prices fell $25.10, or 1.6 percent, to close at $1,515.30 an ounce on the Comex in New York. Gold ranged between $1,505.50 and $1,543.50.
Silver prices for July delivery fell $3.197 to settle at $39.388 an ounce. Silver prices moved between $38.940 and $42.325. Silver’s decline of 7.5 percent was followed by losses of 7.6 percent on Tuesday and 5.2 percent on Monday. The metal has fallen $9.21, or 19.0 percent, since Friday.
"The legacy of raised margin requirements and further long liquidations was obvious in the silver market as the white metal underwent its largest two-day drop in three years and once again made headlines; this time about its precipitous decline," noted Jon Nadler, Senior Analyst at Kitco Metals Inc., early Wednesday morning.
"None of this should come as a surprise for the precious metal is notoriously volatile and can exhibit patterns such as the 38% spike it has enjoyed thus far this year, or the 78% free-fall it endured following its top in 1980. Monday night’s 12% decline only served as a reminder that silver retains the title of being the most volatile asset one may include in an asset basket."
Platinum prices for July delivery ended down $34.20, or 1.8 percent, to close at $1,826.30 an ounce. Platinum ranged between $1,816.70 and $1,859.10.
Palladium prices for June delivery plummeted $35.70, or 4.6 percent, to $746.70 an ounce. Palladium traded between $741.60 and $779.55.
London precious metals prices were mixed when comparing their PM fixings on Wednesday from those on Tuesday. Gold advanced slightly while the other metals fell. The PM gold fix added 75 cents at $1,541.00 an ounce. Silver declined $3.320 at $40.290 an ounce. Platinum fell $17.00 at $1,841.00. Palladium lost $15.00 at $760.00.
All one-ounce United States Mint bullion coins advanced Wednesday — the Gold Eagle by 5,000, the Silver Eagle by 47,000 and the Gold Buffalo by 1,000. The following sales figures, as published by the Mint, reflect daily, May and year-to-date bullion gains.
|US Mint 2011 Bullion Coin Sales|
|American Eagle Gold Coin (1 oz)||5,000||18,500||376,500|
|American Eagle Gold Coin (1/2 oz)||0||10,000||43,000|
|American Eagle Gold Coin (1/4 oz)||0||2,000||54,000|
|American Eagle Gold Coin (1/10 oz)||0||5,000||205,000|
|American Buffalo Gold Coin (1 oz)||1,000||3,000||61,500|
|American Eagle Silver (1 oz)||47,000||701,000||15,949,000|
|2011 ATB Silver Bullion Coins (5 oz)||0||12,400||237,800|