<b>Gold</b> Declines for First Time in Three Days as Dollar Advance Curbs Appeal

Gold declined for the first time in three days as the dollar advanced, curbing the appeal of commodities as alternative investments.

Bullion for immediate delivery fell as much as 0.5 percent to $1,347.35 an ounce at 12:51 p.m. in Melbourne, after reaching an all-time high of $1,364.77 on Oct. 7. The dollar rose 0.2 percent against a basket of six major currencies. The precious metal typically moves in the opposite direction to the dollar.

“Given that we have seen solid upward movements in the gold price for some time now, it is just an opportunity for market participants to catch their breath,” said Gavin Wendt, senior resource analyst at MineLife Pty in Sydney.

The dollar rose before the Federal Reserve releases today minutes of its policy meeting on Sept. 21, when the central bank said it was willing to ease monetary policy further to sustain the economic recovery.

Gold for December delivery on the Comex in New York fell 0.4 percent to $1,348.90 an ounce. Futures have advanced 23 percent this year and reached an all-time high of $1,366 an ounce on Oct. 7.

“The precious metals markets remain range-bound since Friday afternoon, with very little interest coming from the physical market for gold and silver at current price levels,” Walter de Wet, an analyst at Standard Bank Plc in London, wrote in a note.

The dollar traded at $1.3864 per euro at 9:36 a.m. in Tokyo from $1.3876 in New York yesterday. The greenback last week reached the lowest level since January against the basket of six major currencies.

Global holdings in exchange-traded products fell about 1.2 metric tons to 2,083.55 tons on Oct. 11, according to Bloomberg data from 10 providers, after reaching a record 2,097.01 tons on Sept. 30.

Silver fell 0.8 percent to $23.1078 an ounce at 12:44 p.m. Melbourne time after gaining as much as 1.6 percent to $23.6325 an ounce yesterday, the highest price since 1980.

Platinum gained 0.3 percent to $1,691.38 an ounce, while palladium was little changed at $587.63 an ounce after reaching a nine-year high of $604 last week.

To contact the reporter on this story: Wendy Pugh in Melbourne at wpugh@bloomberg.net

To contact the editor responsible for this story: Richard Dobson at rdobson4@bloomberg.net

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