Gold futures drop under $600 an ounce

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Gold futures drop under $600 an ounce, prices at lowest level since late June; silver also sinks

Gold futures dropped under $600 an ounce Monday to their lowest level since late June, some analysts blaming the sharp declines on European central bank gold sales.

The belief the Washington Agreement participants would not meet their quota by September 26th now looks like wishful thinking, analysts said, referring to a handshake-pact among certain central banks to set limits on each year's sales of the metal from sovereign vaults.

Precious metals prices have seen some hefty losses over the past several days, but many analysts believe the declines provide a buying opportunity.

Meanwhile, weakness in oil helped fuel gold's drop. Crude futures fell under $66 a barrel to touch their lowest level since late March.

On the broader political front, a senior U.S. envoy said Monday that it welcomed progress at talks aimed at ending the nuclear standoff with Iran, but also said that the United Nations Security Council plants to move toward sanctions if Tehran doesn't freeze uranium enrichment, the Associated Press reported Monday.

World gold prices are falling at precisely what ought to be a time of seasonal strength in the marketplace, prompting stish shot-term speculators to bail out en masse, rather than await the much-anticipated return of the throngs of jewelry buyers from India.    However, most of the analysts forecast a  big reflex rally is near.