Gold retreats after rally as stronger dollar reduces demand

Gold prices down by 1.4 per cent to USD 1,195.65 an ounce

London: Gold retreated after the biggest one-day rally in more than a year, as a stronger dollar curbed demand for the metal as a protection of wealth. Gold fell by 1.4 per cent to USD 1,195.65 an ounce and silver dropped 1.7 per cent to USD 16.18 an ounce. It rebounded yesterday from a five-year low of USD 14.42 to settle 6.5 per cent higher, the biggest gain since January 2012.

Gold jumped 3.8 per cent yesterday, reaching a one-month high. It rebounded from a three-week low as crude oil reversed a drop to the lowest in five years and as some investors closed out bets on lower prices.The greenback advanced to the highest since 2009 yesterday amid expectations the Federal Reserve will raise interest rates next year, reducing gold’s allure because the metal generally offers investors returns only through price gains.

( Source : PTI )
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