By Kim Kyoungwha Feb. 25 (Bloomberg) -- Gold declined for a fourth day as gains in the dollar eroded demand for the metal as an alternative investment. Bullion for immediate delivery weakened 0.6 percent to $1,091.05 an ounce at 2 p.m. in Singapore. Gold futures for April delivery fell 0.5 percent, extending its decline to 11 percent from a Dec. 3 record. “Investor money looking for safe assets should be the factor” driving gold lower, said Tetsuya Yoshii, vice president for derivative products with Mizuho Corporate Bank Ltd. in Tokyo. Bullion “might have a $20 to $40 correction on the downside,” he said. The Dollar Index, a six-currency gauge of the greenback’s value, strengthened 0.4 percent amid concern that Greece’s credit rating may be lowered. The dollar fell yesterday after Federal Reserve Chairman Ben S. Bernanke said the U.S. needs low interest rates to preserve a “nascent” recovery. Asian stocks fell for a second day after Standard & Poor’s said it may lower Greece’s credit rating again by the end of March as a weak economy and political opposition threaten the country’s ability to cut the largest budget deficit in the European Union. Gold holdings in the SPDR Gold Trust, the biggest exchange-traded fund backed by bullion, were unchanged at 1,106.99 metric tons as of yesterday, according to the company’s Web site. Commodity Demand Investment demand for commodities, especially metals, may wane in the next three months because of concerns that the global economic recovery may be slower than expected, according to Allianz Investment Management. “There could be a lot of unwinding” of bets that raw materials will advance, Nikhil Srinivasan, who oversees about $30 billion of assets as Allianz’s chief investment officer for Asia and the Middle East, said in an interview yesterday. “That will keep them from having a strong year.” Silver, the worst-performing precious metal this year, may slide to $14 an ounce, Barclays Capital said this week, citing a trading pattern. Silver, which has dropped 6.6 percent this year, lost 1.3 percent to $15.7675 an ounce in Singapore. Platinum was little changed at $1,509.10 an ounce and palladium declined 1 percent to $418.38 an ounce. To contact the reporter on this story: Kyoungwha Kim in Singapore at Kkim19@bloomberg.net

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