Gold prices tumbled 1.8 percent Thursday after the European Central Bank doused hopes that it would accelerate purchases of debt-choked Eurozone nations.

The ECB cut a key interest rate by 0.25 percent but then the new head of the Eurozone's central bank, Mario Draghi, said member governments struggling with overwhelming debt should not expect the bank to buy their bonds.

That cut gold to its biggest one-day fall in nearly three weeks. Since Nov. 4 the metal has given up 4.5 percent of its value.

Draghi's comments on bond buying also sent European stocks and the single currency down sharply. U.S. stocks also fell, but the dollar was up in afternoon trading by 0.45 percent against a basket of major currencies to 78.91.

Gold also was weighed down by a need for U.S. dollars, which is causing some institutions to lend gold for dollars and so resulting in a negative gold lease rate, James Steel, an analyst with HSBC said in a note. This is bearish for gold, as it increases the near-term supply and liquidity of gold available to the market.

Gold for February delivery dropped $31.40 to $1,713.40, while spot gold fell $32.90 to $1,709.23.

Silver for March delivery was off $1.04 to $31.59, while spot silver was off 97 cents to $31.56.