Gold is getting slammed

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Gold is getting slammed down this morning – along with bonds and oil – as signs that the conflict in Syria may de-escalate emerge.

Right now, the metal is down 1.9% to $1360 an ounce.

Meanwhile, West Texas Intermediate crude oil futures are down 2.2% to $107.10 a barrel.

10-year U.S. Treasury futures are down 0.4%, and the yield on the 10-year Treasury, at 2.96%, is 5 basis points higher from yesterday’s close.

Syrian Foreign Minister Walid al-Moallem said today that the Assad regime accepted a Russian plan to hand over the regime’s chemical weapons stockpiles to international control. The use of chemical weapons has been the key driver of the Obama administration’s argument that the U.S. should take military action against Assad.

“Armed conflicts especially in the Middle East have historically had a visible impact on gold prices through increased geopolitical risk and often oil price spikes,” said BofA Merrill Lynch commodity strategists in a note to clients Monday. “We believe this time is not different: gold could rally immediately after the conflict starts although the rally could subside if the conflict does not escalate.”

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