By Nicholas Larkin and Sungwoo Park Aug. 10 (Bloomberg) -- Gold, little changed in London today, may decline as a stronger dollar cuts demand for the metal as an alternative investment. The dollar gained against the euro for a second day before the Federal Reserve releases a policy statement later today. Gold, which usually moves inversely to the greenback, advanced last week on speculation the Fed will extend the U.S. economic stimulus. European and Asian equities declined. “With equities lower and the dollar trading higher, gold has slipped,” said James Moore, an analyst at TheBullionDesk.com in London. “The focus will be on the strength and tone of Bernanke’s statement this evening and whether the Fed chairman takes further action to bolster the economy.” Immediate-delivery bullion lost $3.10, or 0.3 percent, to $1,198.25 an ounce at 9:11 a.m. in London. The metal for December delivery was 0.2 percent lower at $1,200.10 on the Comex in New York. Futures fell for the first time in nine days yesterday, ending the longest rally since November. Speculation that the Fed will restart a bond-buying program to support the economy mounted after Chairman Ben S. Bernanke said July 21 the outlook “remains unusually uncertain.” U.S. nonfarm payrolls fell by 131,000 positions last month, more than economists had expected, a report showed on Aug. 6. The Federal Open Market Committee plans to release a statement at about 2:15 p.m. in Washington. The Fed resorted to direct bond purchases, also known as quantitative easing, as part of its response to the world financial crisis. The central bank in March ended its emergency purchases of $1.425 trillion of housing debt after completing purchases of $300 billion in Treasury securities in October. ‘Price Will Hover’ “Worsened employment data may imply the U.S. will maintain expansionary policy a bit longer, which would be supportive for gold,” said Park Jong Beom, a broker at Tong Yang Futures Trading Co. in Seoul. “The price will hover around $1,200 an ounce before the Fed meeting.” Assets in the SPDR Gold Trust, the biggest exchange-traded fund backed by bullion, were unchanged at 1,282.75 metric tons yesterday, according to the company’s website. Holdings have been little changed since dropping 18.55 tons on July 28, the most in more than two years. Silver for immediate delivery in London lost 0.8 percent to $18.19 an ounce. Platinum declined 0.3 percent to $1,541.80 an ounce. Palladium fell 0.3 percent to $476.20 an ounce. To contact the reporters on this story: Nicholas Larkin in London at nlarkin1@bloomberg.net; Sungwoo Park in Seoul at spark47@bloomberg.net.

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