By Nicholas Larkin Dec. 23 (Bloomberg) -- Gold, little changed today in London, may decline as lower crude-oil prices diminish demand for the metal as a hedge against inflation. Oil fell on speculation that a deepening global recession is reducing fuel demand, extending its decline from a July record to 73 percent. Volatility in exchange rates may also spur investors to trade less because of concern that price swings increase risk. Cheaper oil “should keep precious metals under pressure,” Manqoba Madinane, a commodity analyst at Standard Bank Group Ltd. in Johannesburg, wrote in a report. “Continued currency volatility today could further compromise precious metals as most investors may opt to watch the developments from the sidelines.” Gold for immediate delivery fell $2.13, or 0.3 percent, to $845.92 an ounce by 8:44 a.m. in London. February futures dropped $1, or 0.1 percent, to $846.10 in electronic trading on the Comex division of the New York Mercantile Exchange. The metal has added 3.4 percent in London this month, while the dollar has declined 9.3 percent against the euro and oil has slipped 28 percent in the period. Gold typically moves in the opposite direction to the U.S. currency. “The precious complex has become more range bound over the past 24-hours as traders begin to wind down ahead of the Christmas holiday,” James Moore, an analyst at TheBullionDesk.com in London, wrote in a report. “Given the thin conditions we would look for the range bound mood to continue.” The dollar weakened for a second day against the euro before a government report that economists estimate will show sales of new U.S. homes declined to the lowest level in more than 17 years. A weaker dollar can increase demand for gold as an alternative investment. Among other metals for immediate delivery in London, silver added 0.1 percent to $10.8512 an ounce. Platinum rose $6.75, or 0.8 percent, to $857.75 an ounce, and palladium was 0.9 percent higher at $174.

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