Gold prices plunged below $900 on Monday in U.S. trading as traders showed optimism in President Obama's potential stimulus plan, reducing the need for a hedge investment. Despite heavy opposition, Democrats are expected to have the votes needed to pass the bill.
April-stamped gold futures finished the session at 892.80 per ounce, a drop of $21.50. Gold fell as low as $891.90 after earlier hitting as high as $913.40.
Treasury Secretary Tim Geithner postponed the unveiling of how the Treasury Department will spend the remaining $350 billion of the $700 billion financial rescue package until Tuesday.
The move was seen as an effort by the Obama administration to allow Washington to focus on the economic stimulus package being debated in the Senate.
Gold fell despite weakness in the U.S. dollar. With traders expressing some increase appetite for risk, the dollar was steady versus the yen but weakened versus the euro and suddenly resurgent sterling.
The dollar fell sharply versus the euro Monday, slipping to a nearly 2-week low of 1.3093 before improving by a penny. The buck also slipped again versus the sterling, slipping to a 4-week low of 1.4985. Usually, gold moves opposite the dollar because of its hedge value.
Gold finished up 10 cents in Friday's session. For the week, gold lost $14.10 an ounce from last the six-month closing high of $928.40 from Jan. 30.
