Gold declined on speculation that an economic recovery will curb demand for the metal as an alternative investment.
The dollar gained against the euro after a Labor Department report showed the U.S. jobless rate unexpectedly fell to 9 percent in January. Earlier, gold reached a two-week high of $1,361 an ounce as the mounting conflict in the Middle East boosted demand for a haven.
“We’ve seen a slight improvement generally in the economic recovery,” said Bernard Sin, the head of currency and metal trading at MKS Finance SA, a bullion refiner in Geneva. “People are still very concerned about the Middle East and will be comfortable buying on any dips.”
Gold futures for April delivery fell $4.60, or 0.3 percent, to $1,348.40 an ounce at 11:58 a.m. on the Comex in New York. Before today, the price dropped 4.8 percent this year.
An improving labor market “would present a downside risk for metal prices” on the prospect that the Federal Reserve would tighten monetary policy, Tom Pawlicki, an analyst at MF Global Holdings Ltd. in Chicago, said in a report.
Yesterday, gold held in exchange-traded products rose 0.87 metric ton to 2,028.9 tons, snapping an eight-session slide, data compiled by Bloomberg from 10 providers show. Holdings have dropped 3.3 percent this year. They reached a record 2,114.6 tons in December.
Silver futures for March delivery gained 21.2 cents, or 0.7 percent, to $28.94 an ounce. Earlier, the price reached $29.285, the highest since Jan. 19.
Palladium futures for March delivery fell $2.65, or 0.3 percent, to $817.90 an ounce.
Platinum for April delivery advanced $3.90, or 0.2 percent, to $1,848 an ounce.
Source: http://www.businessweek.com
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