Gold plunges below $US1500, the most in 30 years

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Gold has plunged the most in 30 years in a dramatic selloff on Wall Street this morning.

Futures volumes were at record highs on the New York Mercantile Exchange as traders sold contracts rather put up more money to maintain their margins.

The latest selloff came after China registered weaker-than-expected growth, stoking concerns that consumers there and in India – the world's two biggest buyers – may slow their purchases.

Earlier, Cyprus said it would sell its gold to help fund its bank bailout.

In just two days, gold futures have lost more than $US200 an ounce - the most in dollar terms since trading started in 1974.

At the close of trading today,  gold for April delivery settled down 9.4% at $US1360.60, its lowest price in more than two years.

The trading volume was also at record levels, easily topping the previous record of 486,315 contracts set on November 28, 2012.

Gold for June delivery hit a low of $US1355.30 an ounce, a decline of 9.7%.

The selloff at one point exceeded the one-day percentage decline of 9.6% on February 28, 1983. Gold prices fell 11% on March 17, 1980.

Background to selloff
Gold prices have been falling steadily since last October as the eurozone crisis and the US fiscal deadlock lessened the metal's safe haven status.

Meanwhile, shares have risen in value as investors switch to higher risk yields and inflation, a major drive of the gold price, fears have receded.

More immediately, gold traders are selling to meet "margin calls" rather than pay out more money in hope of a recovery.

The trading decline began in Asia where China's slower growth figures and lower demand in India were factors.

Other markets for metals have also been affected, as demand in China is also expected to ease for copper. Silver was down 11% to $US23.3550 an ounce, platinum down 4.8% to $US1424.80 an ounce and palladium down 5.9% to $US667 an ounce. 

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Just waiting for all the gold conspiracy theorists to come over the hill!

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Soros at work here - he's going to break the ETFs like he did the Bank of England.

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Don't worry, gold will go up tomorrow and the stock market will go down.

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