Gold drops to three-week low, silver below Rs 40k

Gold prices, in sync with the global trend, hit its three-week low here as local buying at the existing level remained lacklustre.
Silver slumped to multi-month lows as well to revisit the Rs 39,000 level following heavy speculative selling.
Globally, gold hovered close to a three-week low today as demand for riskier assets drove stocks and US treasury yields higher. The dollar hit a six-week peak against the yen.
Investors looked ahead to the outcome of a two-day US Federal Reserve policy meeting to be announced tomorrow and jobs data that will indicate the speed of US growth revival.
Standard gold (99.5 per cent purity) fell by Rs 275 to end at Rs 28,650 per 10 grams from last Friday's close of Rs 28,925, the rate not seen since April 10 at Rs 28,670.

Pure gold (99.9 per cent purity) also declined by a similar margin to settle at Rs 28,800 per 10 grams against Rs 29,075 previously.

Silver (.999 fineness) plunged by Rs 920 per kg to Rs 39,690 compared to Rs 40,610 earlier. This is the lowest since since January 3 at 39,440 per kg.
In London, spot gold was down 0.1 per cent at USD 1,255.02 an ounce in early trade.
Silver was up 0.5 per cent at USD 16.93 an ounce.