Investing.com - Metal prices were hurt by an ongoing rise in the dollar and worries that an economic crisis in Turkey could spread to emerging markets which would hit already fragile demand for commodities.
Gold futures for August delivery on the Comex division of the New York Mercantile Exchange fell by $15.90 or 1.13%, to $1,184.80 a troy ounce.
Gold prices failed to hold onto the psychologically important $1,200 swinging to an 18-month low as dollar continued to edge higher, hurting demand for the yellow metal.
The U.S. dollar index, which measures the greenback against a trade-weighted basket of six major currencies, rose by 0.44% to 96.58.
The rise in the dollar comes as concerns over Turkey persisted, with some analysts warning a recession beckons as higher interest – to support the lira – would stifle growth.
"A recession is on the horizon in Turkey, but the depth of the recession depends on the measures taken," ABN Amro said. "Lower growth, higher interest rates and on balance a weaker currency would still make it difficult for certain [Turkish] companies to fulfill their external debt obligations, but a national debt crisis would be avoided," it added.
Gold is sensitive to moves higher in the U.S. dollar – a stronger dollar makes gold more expensive for holders of foreign currency, thus, reduces investor demand for the precious metal.
Sentiment on the commodities including metals have soured recently as the crisis in Turkey, and data pointing to a slowdown in China's economy has created a cocktail of uncertainty, keeping a lid on demand.
Copper prices fell 3.95% to $2.58, slipping into bear-market territory, while zinc prices fell 6.44% at 2,293.50.
Aluminium prices fell 2.05% to 2,026.25, while Nickel futures fell 4.06% to 12,885.00.
Silver futures fell 0.45% to $14.45 a troy ounce, while platinum futures fell 3.92% to $770.30