Aug 5 (Reuters) - Gold fell more than 2% on Monday, caught in the slipstream of a global, wider market selloff driven by mounting economic concerns, although analysts said this would be a temporary correction for the safe haven.
Spot gold was down 2.2% at $2,389.79 an ounce by 10:15 a.m. ET (1415 GMT). U.S. gold futures lost 1.6% to $2,430.00.
Spot silver was down 5.1% at $27.08.
Wall Street tumbled, as fears of the United States tipping into recession following weak economic data last week rippled through global markets.
"Investors are spooked and they're selling what they can, and that includes gold and silver," said Jim Wycoff, senior analyst at Kitco Metals.
The sell-off in autocatalysts platinum and palladium also reflected deepening concerns over industrial demand.
Platinum fell 4.3% to $917.10 and palladium lost 3.5% to $859.00 after hitting its lowest since August 2018. The two metals are used in engine exhausts to reduce emissions.
While gold is considered a safe refuge during such uncertainties, it was not immune to Monday's sell-off as investors dumped assets across the board.
Treasury bonds, meanwhile, were in demand, with U.S. 10-year yields touching the lowest since mid-2023 as fears of a recession worsened after a bleak July payrolls report.
However, analysts said gold, which has risen more than 16% thus far this year, could regain its footing looking ahead, given the persistent and political uncertainties and also on expectations of interest rate cuts from the Federal Reserve, which should bode well for the zero-yield bullion.
European stocks joined a global selloff Monday - but in calmer fashion than Asia.
Markets were now expecting the central bank to cut by as much as 50 basis points in the September meeting.
"Elevated geopolitical tensions and recent hopes for even greater Fed rate cuts should create supportive conditions for bullion. Ultimately, gold should be able to post a new record high once nerves settle," said Han Tan, chief market analyst at Exinity Group.
Reporting by Anushree Mukherjee and Ashitha Shivaprasad in Bengaluru; editing by Arpan Varghese and Vijay Kishore
