Gold, little changed in Asia, may decline as the US dollar advanced against global currencies and some investors sold after the metal’s jump to a record last week.
The Dollar Index, a six-currency gauge of the greenback’s value, strengthened for a second day, supported by comments from Ben Bernanke. The Federal Reserve chairman said last week that the US central bank is ready to ''tighten'' monetary policy. Bullion touched an all-time high of $US1061.55 an ounce on Oct. 8 and has advanced 19 per cent this year.
''The dollar’s strength, coupled with a recent rally in gold prices, is luring some investors to sell,'' said Park Jong Beom, a trader with Tongyang Futures Co. in Seoul. Still, the dollar’s rise today doesn’t signal the reversal of the currency's downtrend, and ''I’m bullish on gold,'' said Park.
Gold for immediate delivery traded at $US1,048.30 an ouncein Singapore, 0.1 per cent lower than the close on Oct. 9. The Dollar Index rose 0.1 per cent to 76.537. Gold tends to move inversely to the US currency.
The Federal Reserve has kept its benchmark lending rate between zero and 0.25 per cent since December to counter the effects of the recession. Consumer prices rose 0.4 per cent in August and were down 1.5 per cent compared with a year earlier, according to the Labor Department.
Bullion gained more than sixfold from 1977 to 1980, touching a then-record $US873 in January 1980 as the US inflation rate topped 14 per cent.
Among other precious metals, silver rose 0.5 per cent to $US17.80 an ounce, platinum added 0.2 per cent to $US1337.50 an ounce and palladium rose 0.4 per cent to $US321.25 an ounce.
