New Delhi: Gold prices fell sharply to three month lows on the bullion market Saturday on sustained selling by stockists and weak overseas trend, ending with a loss of Rs 50 at Rs 9,180 per ten gram.
Trading activity was also effected following off marriage and festival season amid fresh arrivals which created adequate stocks position. It fell to a level last seen on April 18.
The metal suffered the most as gold fell $ 7.30 to $ 605.95 an ounce last evening in European markets.
Prices were down 5 per cent this week, after tumbling 11 per cent in the previous three weeks.
A hike in interest rates by banks in domestic and global markets also reduced the lure for the precious metal.
The European Central Bank, the Bank of Korea, Reserve Bank of India and South African Reserve Bank all raised rates yesterday.
The US Federal Reserve officials have indicated they may follow.
Higher interest rates boost the value of assets such as bonds, and make gold less attractive because precious metals don't bear interest.
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