Gold Drops for Third Time in Four Days as Dollar Rebounds
Gold futures fell for the third time in four sessions as the dollar’s rebound damped demand for the precious metal as an alternative investment.
The Bloomberg Dollar Index, a gauge against 10 major currencies, rose as much as 0.2 percent. Earlier, gold reached a one-week high as U.S. lawmakers remained at an impasse on the budget and an increase for the nation’s debt ceiling, boosting demand for a haven. Futures trading was 27 percent below the average for the past 100 days, data compiled by Bloomberg showed.
“The dollar’s strength pushed gold lower,” Tom Power, a senior commodity broker at R.J. O’Brien & Associates in Chicago, said in a telephone interview. “We are seeing a lot of investors waiting on the sidelines.”
Gold futures for December delivery dropped less than 0.1 percent to settle at $1,324.60 an ounce at 1:44 p.m. on the Comex in New York. Earlier, the metal reached $1,330.80, the highest for a most-active contract since Oct. 1. The price has slumped 21 percent this year.
Senate Democrats are planning a test vote before the end of this week on a measure that would grant authority to the White House on raising the $16.7 trillion debt ceiling. President Barack Obama reiterated that he won’t negotiate with Republicans over the borrowing limit. Treasury Secretary Jacob J. Lew warned the U.S. may be unable to pay its bills after Oct. 17.
Silver futures for December delivery climbed 0.3 percent to $22.443 an ounce. Earlier, the metal reached $22.525, the highest since Sept. 20.
On the New York Mercantile Exchange, platinum futures for January delivery advanced 0.1 percent to $1,403.70 an ounce.
Palladium futures for December delivery rose 1.4 percent to $714.90 an ounce.
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