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Of DOW JONES NEWSWIRES
NEW YORK (Dow Jones)--A stronger U.S. dollar pressured gold futures Friday, and participants booked profits, but the most-active contract managed its sixth consecutive close over $1,000 an ounce.
Most-active December gold fell $3.20 to settle at $1,010.30 an ounce on the Comex division of the New York Mercantile Exchange.
"Gold is about the dollar," says Frank Lesh, broker and futures analyst with FuturePath Trading. "Gold is the new international currency."
Shortly after gold settled, the ICE Futures U.S. dollar index was up 0.276 point.
A weakening dollar of late, combined with inflation-hedge buying, has sparked gold's recent rally into four-digit territory. Gold is often bought and sold inversely with the dollar since the metal is considered a dollar hedge and, more broadly, an alternative currency. Some participants believe the metal will hold its value more strongly than other assets in times of rising producer and consumer prices.
"The dollar is firmer, and we're seeing some light profit-taking in light volume," said Sterling Smith, market analyst with Country Hedging.
He said the dollar is showing signs of bottoming and, if that happens, it could pressure gold prices, especially at these levels.
"People are a little bit cautious up here" at above-$1,000 prices, said Stephen Platt, analyst with Archer Financial Services.
Silver futures took cues from declines in the gold market. Comex December silver fell 20 cents, or more than 1.1%, to settle at $17.065 an ounce.
Silver's smaller market than gold often exacerbates the gray metal's moves, enabling it to see bigger price swings in percentage terms than gold, Lesh said.
Platinum-group metals slipped modestly in light trading as a stronger dollar and profit-taking pressured the precious-metals complex, a trader said.
Nymex October platinum lost $3.30 to settle at $1,338.20 an ounce while December palladium on the exchange slid $1.25 to settle at $304.50 an ounce.
Settlements (ranges include open-outcry and electronic trading):
London PM Gold Fix: $1,012.00; previous PM $1,018.50
At 1:47 p.m. EDT:
Product Price Change Range
Spot gold: $1,009.30 Down $4.80 $1,007.10-$1,017.80
Dec gold: $1,010.30 Down $3.20 $1,008.00-$1,019.50
Dec silver: $17.065 Down 20 cents $17.010-$17.400
Oct platinum: $1,338.20 Down $3.30 $1,330.00-$1,347.10
Dec palladium: $304.50 Down $1.25 $301.70-$308.70
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