Gold drops on China data, ending year's best run

Gold today fell, after rallying for five days in its best run this year, declining with other commodities after data showed China's manufacturing expanded at a slower pace.

 

The gold lost 0.31 % to $ 1,421.90 an ounce. Prices are 9.4 % below the $ 1,561.45 close on April 11, before they plunged 14 % in two days, the worst slide since 1983. Silver also slumped 1.50 % to $ 23.06 an ounce.

 

The preliminary reading of 50.5 for a China Purchasing Managers' Index released by HSBC Holdings and Markit Economics compared with a final 51.6 for March, adding to concern the world's second-biggest economy is faltering. The number was below the median 51.5 estimate.

 

Bullion rallied for five days through yesterday, when it reached a one-week high of $ 1,439.30, as physical purchases increased.

 

The metal fell to a two-year low of $ 1,321.95 on April 16. Volume on the Shanghai Gold Exchange's benchmark cash contract jumped to a record yesterday, while sales of gold coins at the US Mint are almost triple so far in April compared with total sales a month earlier.