Gold fell in London as gains in the dollar may curb demand for the metal as an alternative asset. Before today, gold climbed 18 percent this year while the dollar dropped 2.6 percent against a basket of six currencies. Gold exchange-traded-product holdings have dropped 3.8 percent from the record on Aug. 8, Bloomberg data show. “The strength of the dollar has hurt gold, but market sentiment remains positive towards the metal,” said Nikos Kavalis, an analyst at Royal Bank of Scotland Group Plc in London. “Ultimately, given the ongoing government debt related crisis, safe haven gold is still appealing to investors and buying should push the price higher over the rest of the quarter.” Gold for immediate delivery dropped 0.1 percent to $1,673.65 an ounce at 11:26 a.m. in London. There is “strong buying interest” at $1,650 to $1,660 an ounce, Kavalis said. The euro fell after the European Central Bank said forcing investors to take losses in the region’s bailouts jeopardizes financial stability. Silver dropped 1.2 percent to $32.2175 an ounce, palladium declined 0.7 percent to $604.50 an ounce and platinum was down 0.8 percent at $1,539.25 an ounce. To contact the reporter for this story: Claudia Carpenter in London at ccarpenter2@bloomberg.net To contact the editor responsible for this story: Claudia Carpenter in London at ccarpenter2@bloomberg.net

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