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Posted by Susan Cramer Aug 16, 2008 |
Prices for gold have come down from record heights for the first time since late in 2007. Prices for the precious metal have been falling in recent weeks, but yesterday showed a steep decline, falling below $800 per ounce to a close of $787 per ounce, down from a March 2007 high of $1,018.50. This is more than a 22% loss, a sharp decline for a commodity boom that was predicted to soar to previously unknown heights. This may have been due to the growing demand for commodities from the emerging markets of China and India.
Gold’s plunge may signal good news for the weak U.S. economy, as analysts point to the strengthening dollar against international currency, and the easing of high prices for crude oil as factors in the falling price of gold. The improvement in other market segments may make this precious metal less appealing to investors. However, some analysts point out that the rise in the dollar is against flagging international currencies, and does not signal an improvement in the U.S. economy so much as a slowdown of the global economy. Another factor in the price drop, according to the Columbus Dispatch for Saturday, August 16th, ‘”May have been the Federal Reserve’s report of higher-than-expected industrial outputs for July.'"
Silver prices have fallen as well, down more than 14% from $21 in July.