Gold Tumbles Over $20 an Ounce

The price of gold tumbled more than $20 an ounce during mid-day trading yesterday, after a better than expected US ADP Non-Farm Employment Change figure gave a boost to the US dollar. Typically, a strengthened dollar dampens investor demand for gold, as it becomes more expensive for international buyers. The precious metal traded as low as $1594.38 before staging a mild upward correction and stabilizing at the $1600 level. Today, gold traders should pay attention to the outcome of the ECB Policy Meeting. If the ECB does announce new measures to combat the euro-zone debt crisis, investors could shift their funds to higher-yielding assets, which may give gold a boost as a result.

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