| In the late afternoon trade, the yellow metal plummeted to $609 an ounce from the day's opening at $614. |
| Moving in tandem with standard gold, pure gold lost Rs 690 "� about 6 per cent "� in the same period under consideration to Rs 9,430 from Rs 10,120 per 10 gm last Monday. |
| "Nobody knows what is happening exactly on Monday in the gold market. Perhaps, owing to too much volatility, the price is going down," said Bhargav Vaidya of B N Vaidya & Associates. |
| The dollar has been strengthening gradually in the currency markets. Central Bank, London, had reportedly decided to sell huge quantity of gold in the open market. |
| "All these factors are contributing to Monday's movement of gold prices," a local trader said. |
| The decline in gold price is also partly attributed to the peace talks in the Middle East for which US Secretary of State Condoleezza Rice has already arrived. This is the first American on-the-ground diplomatic effort to resolve the conflict between Lebanon and Israel. |
| Oil price, another gold price determining factor, has remained rangebound and has, thus, left traders clueless for price speculation in the weeks ahead. |
| All gold futures on Multi Commodity Exchange on Monday went down by about 2 per cent, seeing the August future close at Rs 9,266 after touching a low of Rs 9,255 intra-day. |
| On the New York Mercantile Exchange, the yellow metal lost 7.2 per cent last week and began the current week on a weak note losing $5.90 at $614.30 an ounce. |
| "Nothing can be predicted for the future price movement of this yellow metal. Despite good demand ahead of the wedding season, gold prices are weakening because of the circumstances beyond control," a Delhi-based trader said. |
| Reuters adds: "People are still nervous of it on the downside," Simon Weeks, director of precious metals at ScotiaMocatta, said. |
| "If we can hang in here for a couple of days, I would expect some bargain hunting and small physical demand to come in. But at the moment it is relatively quiet," he said. |
| Gold fell 1.3 percent to $611.50 an ounce, its lowest since June 30, before recovering to $616.40/617.90 by 0920 GMT. Prices are still down from $619.50/621.00 in New York on Friday when gold dropped nearly 2 percent. |
| In Japan, the benchmark June 2007 gold futures contract on the Tokyo Commodity Exchange fell 43 yen per gram to 2,330 yen, tracking losses in the U.S. market. |
| Spot gold climbed to a two-month high last Monday on safe-haven buying as fighting between Israel and Hizbollah guerrillas in Lebanon escalated. |
| "The market seems to be downgrading the political risk associated with events in the Middle East. Oil prices are failing to react to further fighting in Lebanon, and this is removing a reason for gold to rally," James Steel, analyst at HSBC Bank. said in a daily note. |
| US Secretary of State Condoleezza Rice said there was an urgent need for a sustainable ceasefire in Lebanon but there was no easing in the fighting on Monday between Hizbollah guerrillas and Israeli forces. Oil eased on renewed diplomatic efforts to resolve conflict in area. |
| Gold is often seen as a hedge against inflation. The dollar rose due to concern that recent selling sparked by expectations the U.S. Federal Reserve could pause its two-year run of rate rises was overdone. |
| "The market could not break out on the upside level. I think that has sent bearish signals to the market," said a dealer in Hong Kong, referring to the heavy selling after gold touched around $636 an ounce last Friday. |
| Physical trading was slow in parts of Asia, with dealers expecting the gold price to head lower. But trading picked up in India, the world's largest gold consumer, ahead of the busy festival season that starts in a couple of weeks. |
| In other precious metals, spot platinum fell to $1,202/1,207 an ounce from $1,206/1,212 late in New York, while palladium was up $1 at $302/307. Silver inched up to $10.83/10.93 an ounce from $10.78/10.88. |
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