Gold Falls as Dollar Gains, Investors Sell Metal to Raise Cash Gold Falls as Dollar Gains, Investors Sell Metal to Raise Cash

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By Pham-Duy Nguyen

Oct. 10 (Bloomberg) -- Gold tumbled from the highest since July as the dollar strengthened and investors sold the metal to cover losses in equity markets. Silver plunged 11 percent.

The dollar headed for the second consecutive weekly gain against a weighted basket of six major currencies. Earlier, gold reached $936.30 an ounce, the highest since July 29, on demand for a haven amid plunging global equity markets.

``Investors are selling gold to raise dollars,'' said Frank McGhee, the head dealer at Integrated Brokerage Services LLC in Chicago. ``It's fear versus dollar strength, and dollar strength is winning.''

Gold futures for December delivery fell $19.60, or 2.2 percent, to $866.90 at 1:07 p.m. on the Comex division of the New York Mercantile Exchange. The metal reached a record $1,033.90 on March 17.

Silver futures for December delivery dropped $1.255 to $10.62 an ounce. Before today, the price dropped 20 percent this year.