Gold futures on the COMEX division of the New York Mercantile Exchange fell Monday, as the World Bank lowered growth forecast for East Asian economies and uncertainty over this week's eurozone meetings pushed the dollar higher, pressuring gold.
The most active gold contract for December delivery fell 5.1 dollars, or 0.29 percent, to settle at 1,775.7 dollars per ounce.
Gold extended Friday's losses and spent the entire session trading in negative territory, strongly pressured by a higher dollar. A stronger greenback is a negative force for commodities like gold, as it makes them more expensive for holders of other currencies.
The dollar rose sharply following news that the World Bank cut its 2012 economic growth forecast for East Asian developing countries from 7.6 percent to 7.2 percent, citing the effects a eurozone slowdown could have on the region, and called for caution.
The eurozone itself also caused some concern Monday, as finance ministers in the region met in Luxembourg to begin a scheduled two- day meeting on the financial situation in Greece and Spain. Investors were eagerly awaiting further news from the region.
In response to the World Bank release and global economic uncertainty, U.S. equities, gold and crude oil all declined, leading to an overwhelmingly bearish outside market atmosphere.
While in the past gold had taken support from safe haven flows and economic stress, recently investors have preferred the dollar as a safe haven.
Silver for December delivery dropped 55.5 cents, or 1.61 percent, to close at 34.017 dollars per ounce.
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