Gold prices fallen sharply today as investors dropped the safe haven asset after centrist Emmanuel Macron took the lead in the race to become France’s next President last night.
Gold was trading 1.39 per cent lower than its previous close price at $1,271.20 per ounce this afternoon, up slightly from a two-week low of $1,265 per ounce earlier today.
"European markets are in a buoyant mood this morning, after the French pollsters got it near enough spot on, with a Macron-Le Pen run-off next month. The move back into risk assets means the chief losers have been the likes of gold and the Japanese yen, with stock markets moving sharply higher," said Joshua Mahony, market analyst at IG.
Macron is favoured to win when he faces the far-right National Front candidate Marine Le Pen in the final round of voting on 7 May.
However, Ipek Ozkardeskaya, senior market analyst at London Capital Group, noted: "Despite the knee-jerk haven outflows from gold, the market remains solidly invested in the yellow metal. The latest [Commodity Futures Trading Commission] data showed that investors bought half a billion worth of gold and gold ETFs [Exchange Traded Funds] last week."
Analysts at Accendo Markets said: "Investors will continue to digest the results from across the channel and potential risk-on mood for equities, while also eyeing any US dollar recovery to further add to bearish sentiment."