Gold declined in London for a third day as the dollar strengthened, reducing the metal’s appeal as an alternative investment to the U.S. currency. The dollar gained as U.S. President-elect Barack Obama crafted a package of infrastructure spending and tax cuts to create 3 million jobs. Bullion, which typically moves in the opposite direction to the U.S. currency, has lost 2.3 percent this year, while the dollar has added 2.1 percent against the euro. “There’s been some selling as the euro weakened against the dollar,” Afshin Nabavi, a senior vice president at MKS Finance SA, one of Switzerland’s four bullion refiners, said by phone from Geneva. Trading is “still choppy” as many market participants are returning from holidays, he said. Gold for immediate delivery fell $12.77, or 1.5 percent, to $862.64 an ounce by 9:05 a.m. in London. The metal rose 5.8 percent last year, a record eighth annual advance. February futures dropped $17.10, or 1.9 percent, to $862.40 in electronic trading on the Comex division of the New York Mercantile Exchange. Crude oil was little changed at $46.35 a barrel in New York trading after climbing as much as 5.1 percent to $48.68 a barrel. The commodity gained after Israeli troops entered the Gaza Strip, escalating the 10-day-old conflict and threatening stability in the Middle East, the largest oil-producing region. “Further oil appreciation should anchor precious metal prices in an environment of increased currency volatility,” Manqoba Madinane, a commodity analyst at Standard Bank Group Ltd. in Johannesburg, wrote in a report. Among other metals for immediate delivery in London, silver slipped 3.2 percent to $11.20 an ounce. Platinum declined $10.25, or 1.1 percent, to $936.25 an ounce, and palladium was 2.1 percent lower at $188.50 an ounce.

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