Economy, Business And Markets

Azadi Follows Gold’s Freefall

Azadi Follows Gold’s Freefall
Azadi Follows Gold’s Freefall

Tehran’s currency market was taken by tumult on Saturday as Friday’s hit on bullion transpired into a fall in the Azadi gold coin. Gold took a large hit on Friday, as a rally in the dollar hit precious metals.

Azadi, the benchmark gold coin, tumbled by 1.15 percent to 9,133,000 rials and the dollar advanced 0.25 percent reaching 32,510 rials on the news, though the changes in price were dampened by the looming threat of a breakup in Iran’s nuclear negotiations, bolstering gold’s safe haven status in the Iranian market.

Gold and silver sank to a four-year low on Friday as the dollar surged against the yen and other major currencies after the Bank of Japan shocked global financial markets by expanding its massive stimulus spending.

Although other gold-denominated coins also fell in reaction to the news, their declines were smaller, with Half-Azadi falling 0.5 percent to 4,620,000 rials and the Quarter-Azadi going down 0.28 percent.

Bullion for immediate delivery broke below $1,180.50 an ounce, a level bullion had held twice during its last two major selloffs in June and December last year.

 It also briefly held the mark earlier this month until Friday’s drop.

Spot gold slid as much as 3 percent to its lowest since July 2010 at $1,161.25 an ounce in earlier trade, Reuters reported. It was last down 2.25 percent at $1,171.71 by 19:57 GMT Friday for its biggest one-day rout since July.

The metal breached important support levels at $1,200 and $1,180, where stop losses - automatic sale orders - were placed and was on track for a 4.8 percent drop this week, the biggest weekly decline since June 2013.

Spot silver earlier fell 4 percent to its lowest since February 2010 at $15.76 an ounce and was poised for a fourth straight monthly drop. It was down 1.71 percent at $16.14, according to Reuters.

Gold and silver were already facing some heat after the US Federal Reserve earlier in the week largely dismissed financial market volatility as factors that might undercut progress toward its unemployment and inflation goals.