Gold falls sharply from all-time high as dollar rallies

08:53, May 14, 2010      

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Gold futures on the COMEX Division of the New York Mercantile Exchange ended much lower on Thursday, as the U.S. dollar extended gains against European currencies. Silver and platinum both dipped.

The most active gold contract for June delivery dropped 13.9 U. S. dollars, or 1.1 percent, to finish at 1,229.2 dollars per ounce.

The U.S. Labor Department said on Thursday that the number of Americans filing first-time claims for jobless benefits dipped to 444,000 last week, which is higher than previous expectations. But given the fact that the U.S. jobless claims had dropped for a fourth straight week, it suggested that U.S. employers have kept adding workers to payroll as economy expanded.

The number of U.S. households facing foreclosure in April declined 2 percent from a year ago, the first yearly drop in five years, according to a separate report released on Thursday.

Investors weighed the better performance of U.S. labor and housing markets against the worsening debt crisis in the eurozone, which sent the euro close to its 14-month low against the U.S. dollar on Thursday. The British pound also retreated against the dollar.

Gold failed to move higher and declined sharply as traders took profit from the last two days' surge. Gold price has skyrocketed recently as investors sought an alternative to currencies. The increase in the value of the U.S. dollar also eroded gold's appeal as safe-haven, and pared its earlier gains.

July silver dropped 16.4 cents to settle at 19.499 dollars per ounce. July platinum was down 7.9 dollars to close at 1,739.4 dollars an ounce.



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