By Dave McCombs Oct. 22 (Bloomberg) -- Gold fell for a second day in Asia to the lowest level in more than a month as signs the global credit crisis may be easing cut demand for precious metals as a store of value. The metal has dropped 7.8 percent in the past five days as Asian money market rates fell and governments worldwide made trillions of dollars available to banks, encouraging lending. South Korea this week joined Europe, Australia and Hong Kong in providing banks with state backing amid a global lending drought. ``The shine is off gold as a safe haven,'' Jonathan Barratt, managing director of Commodity Broking Services in Sydney, said today by phone. ``Financial players across the board have been given some good indications that guarantees on deposits mean you don't have to worry.'' Gold for immediate delivery fell as much as 1.6 percent to $759.12 an ounce, the lowest level since Sept. 12, before trading at $759.76 an ounce at 2:30 p.m. Singapore time. Silver for immediate delivery was at $9.985 an ounce, 1.2 percent lower than from New York yesterday. The metal will probably trade in a ``narrow range'' this week and may decline to as low as $745 an ounce, Barratt said. Results of the Federal Reserve's $150 billion auction of one-month loans yesterday suggest the central bank's increase in funds available and the government's capital injections into banks are discouraging cash hoarding. The three-month London interbank offered rate for U.S. dollar loans, or Libor, slid 23 basis points to 3.83 percent yesterday, the lowest since Sept. 26. Dollar Rally ``A rally in the U.S. dollar prompted funds to liquidate gold for cash,'' Adrian Koh, analyst at Phillip Futures Pte. in Singapore, said in a report today. The dollar rose to more than $1.28 against the euro for the first time since November 2006 on speculation the European Central Bank will cut interest rates to bolster growth as the global economy heads for recession. A decline in crude oil prices also weighed on the bullion market as it reduced the appeal of the precious metal as hedge against inflation. Crude oil in New York fell to a one-week low of $69.26 a barrel today. Gold for December delivery fell 1 percent to $760.60 an ounce in after-hours electronic trading at 2:34 p.m. Singapore time on the Comex division of the New York Mercantile Exchange. Gold for August delivery on the Tokyo Commodity Exchange fell 5 percent to 2,411 yen a gram ($753 an ounce). To contact the reporter for this story: Dave McCombs in Tokyo at dmccombs@bloomberg.net.

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