By Jae Hur June 1 (Bloomberg) -- Gold climbed to the highest in more than three months as a slumping dollar increased demand for the precious metal as a store of value. Silver gained to the highest since August. Precious metals advanced as the dollar dropped 1.6 percent today against a basket of six major currencies, after posting its biggest monthly loss this year in May. Silver gained 27 percent in May, the most since April 1987, and gold rose 10 percent, the most since November. “The dollar’s weakness continued to lend support to commodities, including precious metals and crude oil,” said Hiroyuki Kikukawa, general manager of research at IDO Securities Co. in Tokyo. Gold for immediate delivery added as much as 0.5 percent to $983.55 an ounce, the highest since Feb. 24, before trading at $983.18 at 10:46 a.m. in Singapore. Silver for immediate delivery climbed as much as 0.9 percent to $15.88 an ounce, the highest since Aug. 8, before trading at $15.85. Spot silver has jumped 39 percent this year, while gold has gained 11 percent. One ounce of gold now buys about 62 ounces of silver, the lowest this year, according to data compiled by Bloomberg. This is down from a high of 84.39 in October, the most since March 1995. “Both precious metals appeared to have been overbought,” Kikukawa said. Silver’s 14-day relative strength index, a gauge of momentum, rose above 70 on May 28, a signal some investors use to indicate prices may be about to decline. The index for gold climbed above 70 on May 29. Commodities posted the biggest monthly rally in 34 years in May, as the slumping dollar bolstered demand for energy, metals and crops as a hedge against inflation. The Reuters/Jefferies CRB Index of 19 raw materials gained 14 percent, the most since July 1974. Among other precious metals for immediate delivery, platinum increased 1.2 percent to $1,207 an ounce and palladium added 0.2 percent to $236.75 an ounce as of 10:37 a.m. Singapore time.

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