Gold prices at 6-month low on US interest rate hike fears

Gold prices sank to six-month lows on Thursday as investors sold holdings in the physical market and the dollar climbed due to expectations of higher interest rates in the United States.

Spot gold was down 0.3 per cent at $1,263.96 an ounce at 1244 GMT but off a low of $1,261.36, its weakest level since December 20. It has lost more than 7 per cent since an April high above $1,365 an ounce. US gold futures were down 0.8 per cent at $1,264.50 an ounce.

Holdings of the largest gold-backed exchange traded fund (ETF), the New York-listed SPDR Gold Trust