Gold retreats amid dollar strengthening
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Xinhua, September 7, 2011
Gold futures on the COMEX Division of the New York Mercantile Exchange retreated on Tuesday, as the rising U.S. dollars reduced appeal of the precious metal as an alternative investment.
The most active gold contract for December delivery declined 3. 6 U.S. dollars, or 0.2 percent, to 1,873.3 dollars per ounce after hitting an intraday record of 1,923.70 dollars an ounce.
Market analysts said that although gold hiked earlier as Swiss central bank announced to set a minimum exchange rate against euro, the strength in U.S. dollar damped its attractiveness and pushed it lower in the day.
U.S. dollar Index on Tuesday traded around 75.9, rising almost one percent from the prior trading day. The value of dollar usually went in the opposite direction with the precious metal.
Gold was also pressured as the Institute for Supply Management said that its service-sector index rose to 53.3 percent in August from 52.7 percent in July, in comparison with a decline predicted by economists.
However, most analysts held that gold prices are going to be underpinned by many supporting factors in the future, including the euro-zone debt concerns, slowing growth in the U.S. and the potential for another round of quantitative easing.
Silver for September delivery also dropped 1.2 U.S. dollars, or 2.8 percent, to 41.868 dollars per ounce. Platinum for October delivery lost 26.6 dollars, or 1.4 percent, to 1858.2 dollars per ounce.
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