Shafaq News/ Gold slumped to a more than four-month low on Monday, as strong U.S. jobs data bolstered expectations for an early tapering of the Federal Reserve's economic support measures.
Spot gold shed 2.1% to $1,725.96 per ounce by 1:40 p.m. EDT (1740 GMT). U.S. gold futures settled 2.1% down at $1,726.50.
Silver was caught in gold's slipstream and hit its lowest in more than eight months, at $22.50 per ounce. It was last down 4% to $23.35.
"The sell-off in gold and silver was a prototypical shake out spurred by Friday's strong jobs report as the market then had to price in the Fed being one step closer to reducing asset purchases and potentially raising interest rates sooner previously anticipated," said David Meger, director of metals trading at High Ridge Futures.
Bullion slipped over 2% after data on Friday showed U.S. employers hired the most workers in nearly a year in July.
An interest rate hike would dull non-yielding bullion's appeal versus interest-earning assets.
Adding to gold's struggles, was the dollar index rallying to a two-week high.
Bullion slid as much as 4.4% and briefly dropped below $1,700 in early Asian trade, but recovered from those lows.
"Strengthening economies, especially in Asia are going to auger for better consumer and commercial demand for gold and silver," potentially stemming their losses, said Jim Wyckoff, senior analyst with Kitco Metals.
High Ridge's Meger also noted economic data would continue to play a pivotal role in the gold market's expectations of stimulus tapering.
"While the job numbers were strong, if in subsequent reports we don't see quite the same exceptional growth or jobs increase, and some type of more transitory effect in inflation, it will confirm the fact that this was clearly an overdone move in gold," Meger said.
Platinum fell 0.4%, to $976.13, having earlier hit its lowest since November. Palladium dropped 0.9% to $2,602.66.