Gold futures slumped to their lowest level in three months Friday, as lawmakers in Washington seemed closer to ending the gridlock over the federal budget.
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Investors often buy gold to protect themselves from economic turmoil. But the safe-haven asset was on pace to record its fourth straight day of losses after Republicans in the House and Senate concluded meetings with President Obama.
The December contract tumbled $28.20, or 2.2%, to $1,268.70 a troy ounce. Futures traded as low as $1,259.60, the lowest intraday price since July 10.
Heavy volume Friday morning caused a very brief halt by CME Group (CME) for the December gold futures contract.
So far this year, gold is down about 23% with investors eyeing the end of the Federal Reserve’s bond-buying program. Higher interest rates have also contributed to the decline, as traders turn to other assets.
Silver futures were also on the decline Friday, trading 2.9% lower at $21.27 an ounce.