CME Group Inc.’s Comex halted trading in December gold futures for about 20 seconds today at 6:26:41 a.m. New York time, said Damon Leavell, a spokesman for the exchange.
The December contract fell about $11 within a minute before trading was suspended, data compiled by Bloomberg show. Leavell declined to comment on the size of the trade that led to the halt. The “stop-logic” mechanism gives traders the opportunity to provide additional liquidity and prevent excessive price movements.
Gold prices dropped 24 percent this year through yesterday, heading for the biggest annual drop since 1981. Prices plunged into a bear market in April as equities rallied and amid concern that the Federal Reserve will slow the pace of its stimulus program, eroding demand for the metal as a hedge against inflation. The U.S. central bank is scheduled to publish minutes of its October meeting today.
“We are seeing continued liquidation in gold,” Adam Klopfenstein, a senior market strategist at Archer Financial Services Inc. in Chicago, said in a telephone interview. “Any sudden drop in prices makes people nervous.”
Gold futures for December delivery fell 1 percent to $1,260.90 an ounce at 9:35 a.m. on the Comex in New York, after touching a one-month low of $1,258.