Gold Trades Near Lowest in More Than One Week

Gold traded near the lowest in more than a week after crude oil tumbled and the dollar rallied, eroding the precious metal's appeal as a hedge against inflation.

Oil fell 2.4 percent yesterday on forecasts a Gulf of Mexico hurricane will miss fields. The dollar traded near a two-week high versus the euro today after Treasury Secretary Henry Paulson voiced support for the currency and the Federal Reserve Bank of Philadelphia President said interest rates should be raised.

Bullion for immediate delivery was little changed at $948.04 an ounce at 10:29 a.m. in Singapore. It fell to as low as $943.72 yesterday, the lowest since July 11. Silver was little changed at $17.97 an ounce.

The dollar traded at $1.578 against the euro at the same time, after rallying to $1.5758 yesterday, the strongest level since July 10. The dollar was at 107.31 Japanese yen from 107.33 yesterday, when it climbed to 107.45, the highest since July 9.

August-delivery gold was little changed at $948.40 an ounce in after-hours electronic trading on Comex at 10:38 a.m. in Singapore.

Gold for June 2009 delivery fell 1.9 percent to 3,298 yen a gram ($955 an ounce) on the Tokyo Commodity Exchange at the 11 a.m. local time break., Bloomberg
7/23/2008 6:45:36 AM