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MTECHTIPS:-Gold falls after reaching 7-wk high, as China triggers global sell-off

MTECHTIPS:-Gold falls after reaching 7-wk high, as China triggers global sell-off

Gold futures fell slightly after reaching seven-week highs on Monday, as China rattled markets throughout the world amid speculation that its central bank is on the verge of injecting further liquidity measures in an effort to jumpstart its flagging economy. On the Comex division of the New York Mercantile Exchange, gold for December delivery wavered between $1,152.00 and $1,169.50 a troy ounce before settling at $1,155.00, down 4.60 or 0.40% on the session. At one point on Monday, gold futures surged to its highest level since July 7 before falling back on a choppy day of trading. Still, the precious metal is close to erasing nearly all of its losses suffered last month during one of its worst 10-day stretches over the last two decades. Gold likely gained support at $1,132.10, the low from August 20 and was met with resistance at $1,186 the high from June 29. On Monday, the Shanghai Composite Index plunged 8.5% suffering its sharpest fall since 2007, as a dearth of activity from the People’s Bank of China created a market-wide panic. Chinese index futures, meanwhile, fell by their limit of 10% providing strong indications that the downturn will continue. The massive sell-off comes days after Chinese manufacturing data dropped to its lowest level since the Financial Crisis, underscoring persistent sluggishness in the world’s second-largest economy. While Chinese GDP grew by 7% over the first half of 2015, many analysts believe China’s economy is decelerating and could suffer its slowest full-year growth in a quarter century.
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