Gold prices fall again sharply

Press, 7 March 1983, Page 27

Gold prices fall again sharply

FA London Gold bullion prices opened steady in Europe on Friday, and then plunged SUSIS i'n hectic trading. The U.S. dollar was mixed.

Gold opened in London at SUS43O a troy ounce, off only 50c from Thursday's closing rate.

But buyers fled from the $430 level at mid-morning, and Londons five major bullion dealers recommended a price of $415.50 after an unusually long l‘a hour fixing session.

In Zurich. Europe's largest bullion market, gold opened at around $428.50. but later dropped to $415. The later

rate represented a loss of $lB from Thursday's closing rate of $433 in Zurich. Earlier in Hong Kong gold lost $5.98 to close at $429.95. Silver was quoted in London at $10.85 a troy ounce, unchanged from Thursday's close. The drop in gold prices came after the United Arab Emirates Oil Minister, Mana Saeed Oteiba, said there was only a 50-50 chance that a mini-summit of O.P.E.C. Ministers in London would reach agreement on oil prices.

But a trader at the major London bullion dealers.

Samuel Montagu, said he did not think the Minister's remarks directly influenced the gold sell-off. "It's been a volatile market and this is just a volatile movement," the dealer said. On Monday gold plummeted more than $5O an ounce to $405, a loss of more than 10 per cent of its value. But prices had been recovering for three days. The recent plunge in world oil prices has raised expectations of world-wide economic recovery through lower energy costs and inflation. Gold, which is non-interest bearing, is a traditional hedge against inflation.