Rising values of the dollar impacted gold futures as it declined for a second day in London, losing interest of the investors who preferred to invest on the greenback.
Bullion for immediate delivery slashed $10.38, or 0.8 percent, to trade at $1,358.02 an ounce at 9:01 a.m. in London. Gold for December delivery also saw a dip of 1 percent with a new trading price of $1,358.50 an ounce on the Comex in New York.
Gold has struggled in recent days after reaching a record high of $1,388.10 on Oct. 14. The metal has seen an aggregate rise of 24 percent in its value in 2010, which also shows its tenth consecutive year of appreciating values. This is the first time since 1920 that the bullion has performed exceptionally well, outranking global equities, Treasuries and most industrial metals.
China is expected to increase gold production to 340 metric tons this year, according to Zhang Fengkui, section chief of the raw materials department at the Ministry of Industry and Information Technology. China’s gold output reached 314 tons in 2009, according to data compiled by the China Gold Association.
Gold assets in ETPs dropped 1.99 tons to 2,102.66 tons on Oct. 15 though it did not impact the holdings, which are up 17 percent this year after reaching a record 2,104.65 tons on Oct. 14.
Other precious metals have also seen a decline in recent days due to rising values of the dollar. Gold and other metals share an inversely proportional relationship with the greenback.
