Aug. 2 (Bloomberg) -- Gold traded near a one-month closing high after the dollar dropped against the euro yesterday, boosting the appeal of the precious metal as an alternative investment to the U.S. currency.

The dollar fell versus 14 of the 16 most actively traded currencies, dropping against the euro for the third day in four, according to Bloomberg data. Gold has climbed 3.2 percent from a six-week low of $418.25 an ounce on June 15 as the dollar fell against the euro. It traded at $431.70 at 8:59 a.m. Sydney time.

``The weaker dollar is allowing gold to basebuild around $430 at the moment,'' James Moore, a Kettering, U.K.-based analyst with TheBullionDesk.com, said in an e-mailed report. Gold could rise to between $435 and $438, he said.

Gold for immediate delivery fell 35 cents to $431.85 an ounce at 10:53 a.m. Sydney time, compared with the 5 p.m. close in New York yesterday. Yesterday, gold rose 0.6 percent to its highest close since June 30.

The dollar traded at $1.2194 against the euro at 10:50 a.m. Sydney time, from $1.2181 late yesterday in New York according to EBS, an electronic currency dealing system. The euro gained 0.5 percent yesterday.

Gold for December delivery was unchanged at $437.80 an ounce in after-hours trading on the Comex division of the New York Mercantile Exchange at 10:46 a.m. Sydney time.

In other precious metals, platinum yesterday rose for the third straight session to a one-year closing high. Platinum for immediate delivery rose as much as $2 an ounce, or 2 percent, to $908.50 an ounce at 10:52 a.m. Sydney time. The metal gained 1.2 percent yesterday to $906.50, its highest closing price since April 2004.

Palladium rose $1, or 0.5 percent, to $194.50 an ounce at 10:31 a.m. Sydney time. The metal has gained 16 percent from a two-year low of $167.50 an ounce reached on July 4.

To contact the reporter on this story: Matt Chambers in Melbourne at mchambers1@bloomberg.net

Last Updated: August 1, 2005 21:00 EDT