Gold price falls

Gold has continued its drop, falling to its lowest level in almost three years, after the US Federal Reserve said it may wind down its stimulus program.

Gold fell to $1,191.21 an ounce in Asian trade, after breaching the $1,200 mark in New York on Thursday for the first time since August 2010.

The US Fed said last week that its bond purchases would start to “taper off” in coming months if the economy recovers. Analysts said investors had been anticipating further price falls. As a result there was a sell-off, resulting in a big drop in prices in recent days.

“You don't want to catch a falling knife, so people who might be buyers are stepping aside and don't want to show gold at their quarter-end statement,” said chief investment officer at Merk Funds, Axel Merk.

- BBC