Gold prices plunged 1.7 percent Thursday on a strengthening dollar, which was rising ahead of a crucial auction of Italian bonds and fresh worries about the health of Eurozone banks. Rome must sell $11 billion in three- and 10-year bonds, and interest rates on the securities were rising ahead of the auction to more than the critical 7 percent level that signals a need for financial rescue. "Ten-years have sold off ahead of the auction and this should help demand," Alessandro Giansanti, a senior rates strategist at ING Groep NV in Amsterdam, told Bloomberg. But "the fact that the yield is still above 7 percent is an indication that the crisis is not solved for Italy." The possibility that the Eurozone sovereign debt crisis may be worsening were accentuated with news from the European Central Bank on Wednesday that lending to stressed Eurozone banks has boosted its balance sheets to more than $3.5 trillion.

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