Gold prices closed sharply higher on Monday, but gave back a lot of its early rally. December gold closed at $746.50, up $12.30 for the session. Gold hit as high as $768.90, its highest level in November. The metal fell off its highs as the dollar recovered early losses against other majors. The greenback fell in early trading against the euro and pound, but turned to the upside by the afternoon. Gold usually moves opposite the dollar because of the precious metal's hedge appeal. Traders reacted to China's 10-step plan to to battle the global economic crisis, which was unveiled on Sunday. The fourth-largest economy said it would relax its credit conditions, reduce taxes and plans a stimulus package amounting to about 4 trillion yuan or nearly $570 billion. U.S. markets also gained on the news that AIG (AIG) received a revised bailout deal that will reduce the original government loan provided to the company and calls for the U.S. Treasury to buy $40 billion of AIG's preferred shares in return for partial ownership. Crude oil prices also gained on Monday, closing at $62.41, up $1.37 per barrel. Like gold, oil gave back most of an early rally after touching above $65 a barrel. The price of gold closed modestly higher Friday as the U.S. dollar saw weakness against other majors. Gold for December delivery $734.20, up $2 for the session. With the rally, gold recovered some of its losses from Thursday's session. Overall, the metal is more than $300 lower than the record $1,033.90 from March 17.

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