The gold price has slumped to levels not seen in five years as economic uncertainty persists in many regions. Investors still see the precious metal as a safe haven in times of turmoil and amid a lack of inflation.
The price of gold hit a new low on Monday as a lack of global inflation left investors with little to hedge against.
The precious metal saw a wave of selling activities in Asia that drove its price down by almost 4 percent at one stage to as deep as $1,072.35 (987.70 euros) an ounce.
Nearly 900,000 lots were traded on a key contract on the Shanghai Gold Exchange, Reuters reported.
"It looks like someone was taking advantage of the low liquidity environment at the moment - it's a bit of speculative selling going on," said ANZ Bank analyst Victor Thianpirya.
China's rising gold stash
The slump in the gold price Monday coincided with news from China, which said its official reserves of the precious metal had risen by a staggering 57 percent over the past six years.
The Bank of China announced bullion holdings jumped to 1,658 metric tons as of the end of June, with the Asian country being the world's largest producer of the yellow metal.
Bloomberg reported that China's gold purchases since 2009 were second only to those of Russia, citing figures from the International Monetary Fund. The country now ranks fifth globally in gold holdings.
hg/sgb (dpa, AFP)