Gold price declines turned into a gold price plunge in midday trading Tuesday as stock exchanges pared losses, U.S. Treasuries fell and the dollar reversed its earlier gains to turn modestly lower.
Gold for December delivery on the Comex carved a new intra-day low of $1,614.60 on a $43.10 drop. For much of the session the yellow metal had hovered around $1,660.
At the same time the Nasdaq Composite Index rose 0.2 percent and the yield on 10-year Treasuries rose slightly to 1.8 percent.
The dollar was edging higher, up 0.13 percent on the ICE US Dollar Index.
The higher stock prices and lower Treasury prices suggested a willingness to take on risk, sparked perhaps by remarks from the head of the U.S. central bank in an appearance before Congress.
Federal Reserve Chairman Ben Bernanke said the central bank was willing to take further steps to aid the frustratingly weak U.S. economy.
Fostering healthy growth and job creation is a shared responsibility of all economic policymakers, in close cooperation with the private sector, he said in prepared remarks.
The Federal Reserve will continue to work to help create an environment that provides the greatest possible economic opportunity for all Americans.
The rise in the stock market, and thus accelerated decline in the gold price, may be a response to the S&P 500 slipping below 1,190, which is 20 percent below its April 29 high of 1,363 and into bear market territory.