By Polya Lesova
FRANKFURT (MarketWatch) -- Gold futures fell on Thursday, as the dollar rallied against other currencies, reducing the appeal of the precious metal as a currency hedge. Gold for February delivery, the most actively traded contract, dropped $16.60, or 1.5%, to $1,119.60 an ounce in electronic trading on Globex. The U.S. dollar rallied to multi-month highs on Thursday, as worries over Greece's ability to finance its debt hurt the euro. Wednesday's statement from the Federal Reserve also supported the dollar. The greenback and gold typically have a strong inverse relationship; when the dollar gains, gold prices tend to fall.
