Gold extended declines to a four-month trough on Tuesday as investors dived into riskier assets following drugmaker AstraZeneca's boost to the coronavirus vaccine race and a U.S. federal agency's White House transition approval for Joe Biden.
Spot gold fell 0.5% to $1,825.99 per ounce by 0545 GMT, having earlier slid to its lowest since July 21 at $1,820.45. It slumped as much as 2.2% on Monday.
U.S. gold futures were down 0.9% at $1,821.30.
"Investors are clearly rallying around the narrative of a vaccine-fuelled economic reopening, to the point they're willing to look past the economic realities and potential downside risks that may lie ahead," said FXTM market analyst Han Tan.
Asian equities rose after AstraZeneca said on Monday its COVID-19 vaccine could be up to 90% effective.
Buoying risk sentiment further, U.S. President-elect Biden received the presidential transition go-ahead from a federal agency on Monday. On Twitter, President Donald Trump said he was recommending that his team "do what needs to be done with regard to initial protocols".
"The fact that we have a smoother transition between President-elect Biden and Trump is just another reason to think that the recovery as it is currently playing out has one less risk to it," said IG Markets analyst Kyle Rodda.
The breakdown of support around $1,840 suggests further downside into the $1,700s before buyers return, he added.
But analysts noted the likely appointment of former Federal Reserve chair Janet Yellen as U.S. Treasury Secretary could boost bets for further fiscal and monetary stimulus and benefit bullion.
Gold is considered a hedge against inflation and currency debasement, likely to result from the unprecedented stimulus unleashed globally this year to ease the pandemic's economic blow.
Silver fell 0.7% to $23.40 an ounce. Platinum rose 0.9% to $934.17, while palladium dropped 0.8% to $2,337.01.
(Reporting by Nakul Iyer in Bengaluru; Editing by Ramakrishnan M. and Rashmi Aich)