Tuesday, July 14, 2009

Gold Falls as Lower Oil, Rising Dollar Dim Appeal; Silver Drops

July 13 (Bloomberg) -- Gold fell as a stronger dollar and lower oil prices cut demand for the metal as an alternative investment. Silver dropped to the lowest price in 10 weeks.

The dollar gained as much as 0.3 percent against a basket of six major currencies. Gold tends to drop when the greenback gains, as some investors sell the precious metal to preserve value. Crude-oil futures, used by some investors as an indicator of the outlook for inflation, fell as much as 2.6 percent.

“Gold fell following the gains in the dollar and crude oil’s inability to make any convincing case for spending much time above the $60 mark,” Jon Nadler, a Kitco Inc. senior analyst in Montreal, said today in a report. “Currency analysts, meanwhile, are turning more bullish on the dollar as well as the yen as the ‘green shoots’ of recovery are suddenly showing a lot of brown spots.”

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