Gold recouped some of its losses in late afternoon, but still failed to come back to the opening level after getting hit by a stronger US dollar, which advanced against the euro on investor concerns over Greece’s fiscal situation. The spread between Greek and German bonds has reached record levels despite the recent bailout package provided to the debt laden country by other euro zone states in the form of a €30 billion loan facility. This decision was reached immediately after rating agency Fitch downgraded Greece’s debt to BBB- from BBB+, hurting Greece’s chances to raise enough money in the market. Gold is seen as an alternative investment to the US dollar and normally moves inversely to the American currency and in tandem with the euro. Earlier this week, gold prices got support from India, which reported stronger demand in the month of March, when the country’s gold imports increased to 27.7 tonnes from just 4.8 tonnes a year ago. Rising physical demand from Indian jewellers has contributed to gold’s recent rally. However, Indian demand cooled off later in the week due to sharply higher prices. Gold declined to US$1,156/oz, while silver and platinum slid to US$18.36/oz and US$1,711/oz respectively.

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