Gold plunged recently to its lowest level in over two years. This reflected all kinds of commodities.
There were explanations including “China’s poor economy”, “Japan’s monetary-policy” , Cyprus planning to sell it’s gold and the rising American Stock-Market.
Gold for June delivery, lost over $140 an ounce to trade well below $1,400, and dropped 5% earlier. Gold is 29% below its record high in September 2011.
Spot-gold, which is for April delivery, also tumbled -- dropping $140.40, or 9.3%, to settle at $1,360.60. That was the biggest drop since Jan. 22, 1980.
China:The world's second-biggest economy grew at a 7.7% annual rate, which was weaker than the 8% most economists were expecting.
Japan’s weak Yen has driven thousands to sell their gold.
Other metals including silver, copper and platinum were also weaker, and oil lost more than 3%.
Investors have been making more money in stocks, abandoning gold as equity markets in the
United States are at all-time highs.
Last week investors sold $1 billion out of the SPDR Gold ETF. So far this year, they've pulled nearly $10 billion out of the $55 billion fund.
Goldman-Sachs and Deutsche Bank both downgraded their forecasts for gold prices, mainly because the U.S. economy appears to be in recovery. Gold normally goes up when economies are failing, and down when economies are gaining strength. Gold is the investment of fear and pessimism, as a last resort place to put money. When people are thinking positive, they invest in "growth" investments.