Gold dropped below $1,580 per ounce Thursday morning, while gold in Sterling and Euros fell back below £1,060 and €1,225 an ounce respectively, extending losses from a day earlier that following stronger-than-expected US retail sales data.
Like gold, silver drifted lower this morning, dipping below $28.60 an ounce, while other commodities were broadly flat and European stock markets ticked higher.
U.S., U.K. and German government bond prices fell, while the U.S. Dollar Index, which measures the Dollar's strength against a basket of other currencies, rose to its highest level since August.
The Dow Jones meantime ended higher Wednesday for the ninth day in a row, setting another new record high.
"The U.S. stock market [is] now increasingly viewed as gold's main 'competition' for investment Dollars," says Ed Meir, metals analyst at brokerage INTL FCStone.
"We think gold lacks both technical momentum and investment interest to recover significantly from current levels," adds a note from Credit Suisse.
"Gold has lost its luster," agrees Danske Bank senior commodities analyst Christin Tuxen, speaking at Bloomberg's FX Debates event in London Wednesday. "Some of the reasons investors had last year to buy into gold are now gone. The focus will be on interest rates not surging, but gradually moving higher."
China's central bank has moved from last year's pro-growth loose monetary policy stance to a "neutral" one, People's Bank of China governor Zhou Xiaochuan has said.
"Obviously there's a lot of [gold] investment demand in China... a large part of why people in China bought gold is because prices went up " says Credit Suisse analyst Ric Deverell, adding that a price fall could be detrimental for Chinese gold demand.
In the U.S., the Commodity Futures Trading Commission is considering whether the twice-a-day London Gold Fix, which sets the international benchmark gold price, could have been manipulated in the same way as the London interbank offered rate (Libor), the Wall Street Journal reported Wednesday.
"[The fixings are] not arbitrary," said a spokesman for the London Bullion market Association. "It's very much done on a demand-supply basis until a price is arrived at. It's fully transparent, it's nothing like Libor."
Over in Europe, "substantial progress is being made toward structurally balanced [government] budgets," according to a draft European Union summit statement obtained by news agency Bloomberg ahead of the two-day meeting which starts today.
The statement, reports Bloomberg, calls for "growth-friendly consolidation" of government finances.
Elsewhere in Europe, Ireland borrowed €5 billion selling new benchmark 10-Year bonds yesterday, the first such sale since the country was bailed out in 2010.
The volume of gold production in South Africa fell 8.1% year-on-year in January, despite total mineral production rising 7.3% over the same period, according to Statistics South Africa figures published Thursday.