Gold Falls as Dollar’s Rebound Crimps Investment Demand

Gold futures fell for the first time in three sessions as the dollar’s rebound eroded the appeal of the precious metal as an alternative asset.

The greenback gained for the first time in a week against the euro as European Union finance ministers gather in Brussels to decide on aid for Greece. On Nov. 23, optimism on Greece helped send gold to $1,755 an ounce, the highest since Oct. 17.

“There is some backpedaling today because the dollar is stronger and there is nothing new out of Europe,” Phil Streible, a senior commodity broker at R.J. O’Brien & Associates, said in a telephone interview. “We are seeing some profit-taking after the nice rally on Friday.”

Gold futures for December delivery slid 0.1 percent to settle at $1,749.60 at 1:42 p.m. on the Comex in New York. The price has climbed 12 percent this year.

Holdings in exchange-traded products backed by gold rose to a record for the sixth straight session, data compiled by Bloomberg show.

Silver futures for March delivery rose 0.1 percent to $34.229 an ounce on the Comex. Earlier, the price reached $34.315, the highest since Oct. 11.

Platinum futures for January delivery fell 0.4 percent to $1,611 an ounce on the New York Mercantile Exchange.

Palladium futures for December delivery dropped 1 percent to $661.20 an ounce.

To contact the reporters on this story: Debarati Roy in New York at droy5@bloomberg.net

To contact the editor responsible for this story: Steve Stroth at sstroth@bloomberg.net