Gold prices fell sharply Thursday after five of the world's top central banks made a joint effort to support European banks in a move designed to ease worries about the region's debt crisis.
The U.S. Federal Reserve, the European Central Bank and three other central banks said they would provide European banks with dollars in three loan installments.
Investors welcomed the announcement because they have been concerned that the region's sovereign debt problems would hurt the European economy and could weigh on the slowing U.S. economy. Many investors sold gold to take profits and move money into riskier assets.
Gold for December delivery fell $45.10 to finish at $1,781.40 an ounce. The price still is up 26 percent for the year.
Gold long has been considered a relatively stable investment when economies hit turbulence. Its price has been volatile for weeks as investors have bought gold when economic news has been discouraging and sold gold on more positive data.
Analysts said prices could continue to fluctuate because there still are global economic hurdles.
For example, new U.S. data showed consumers paid more for a range of goods and services last month, unemployment benefit applications jumped last week to the highest level in three months and August manufacturing was weak.
Gold "probably might have to stay on the defensive for a day or two until the full ramifications of the central bank statements become clear," HSBC analyst James Steel said. But, he added, that lower gold prices could attract new buyers into the market.
"We have seen wide price swings for months now and I think that's going to be the hallmark of the market as much as anything else," he said.
The decline in gold also hurt silver and platinum. December silver fell $1.032, or 2.5 percent, to end at $39.501 an ounce while October platinum dropped $35.30 to $1,780.60 an ounce.
Other commodities were mixed.
Copper for December delivery rose 5.9 cents to finish the session at $3.957 per pound while December palladium rose $2.50 to $723.50 an ounce.
Tenchmark oil rose 49 cents to finish at $89.40 per barrel on the New York Mercantile Exchange. Heating oil rose 7.96 cents to $3.0246 per gallon, gasoline futures rose 5.7 cents to $2.7828 per gallon and natural gas fell 16.1 cents, or 4 percent, to $3.878 per 1,000 cubic feet.
December wheat fell 8.5 cents to end at $6.96 per bushel, December corn fell 23.25 cents, or 3.2 percent, to $7.01 per bushel and November soybeans fell 24 cents to $13.5875 per bushel.