Gold declines sharply as dollar soars
Gold futures on the COMEX Division of the New York Mercantile Exchange closed much lower and touched a 3-week low on Monday as U.S. dollar strongly recovered from its 14-month low. Silver and platinum both dropped. The most active gold contract for December delivery dropped 13.60 U.S. dollars, or 1.3 percent, to finish at 1,042.80 dollars an ounce. It tumbled to as low as 1,041.10 dollars shortly before pit trading closed. That is also the weakest level since Oct. 7.
Dollar saw its strongest performance in more than two months after negative Dallas Fed Reserve business activity data, putting much pressure on gold as the precious metal's appeal of hedge weakened.
By the end of gold floor trading time, the dollar index, a gauge measuring the greenback's value against a basket of major currencies, rose 0.401 to 76.01, the highest level in 2 weeks. The rate against euro climbed to 1.4895, up more than 1 cent from last Friday.
A stronger dollar also forced crude oil, which is priced in the U.S. currency, to go down sharply. The Benchmark contract for December delivery slid more than 2 dollars when gold floor trading ended. The negative spillover affect pressured much on the yellow metal.
December silver was down 62.8 cents to 17.095 dollars per ounce. January platinum lost 23.70 dollars to 1,345.80 dollars an ounce.
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