April 8 (Bloomberg) -- Gold dropped as investor holdings contracted for an eighth week in the worst run since 2004 and the dollar climbed, curbing demand for the metal as an alternative asset.
Gold for immediate delivery fell as much as 0.3 percent to $1,576.11 an ounce and traded at $1,577.35 at 8:50 a.m. in Singapore. Earlier, the metal rose to $1,583.20, the highest price since April 2, extending a 1.7 percent rally on April 5 after U.S. jobs data missed expectations, bolstering the case for prolonged central-bank stimulus.
Holdings in ETPs dropped 0.6 percent to 2,434.436 metric tons last week, the lowest level since August, according to data compiled by Bloomberg. Investors sold a net 0.9 ton on April 5 even after data showed U.S. payrolls had the smallest gain since June. The Dollar Index, a gauge against six major counterparts, rallied as much as 0.3 percent today as the yen dropped to the lowest level since 2009.
"We’ve seen gradual rise in U.S. currency because there’s really nowhere else to go," said David Lennox, an analyst at Fat Prophets in Sydney. "The U.S. economy looks in pretty good shape compared to everyone else, that’s pushing the currency up and having a detrimental impact on gold."
International Monetary Fund Managing Director Christine Lagarde said yesterday that a "substantial portion" of the global economy appears better now than a year ago. Holdings of gold in ETPs have dropped 7.5 percent this year, and prices slumped to a 10-month low on April 4, nearing a bear market.
Bullion for June delivery was little changed at $1,577.90 an ounce on the Comex after rallying 1.5 percent on April 5.
Spot silver was unchanged at $27.325 an ounce after gaining as much as 0.4 percent. Platinum was little changed at $1,539.75 an ounce, while palladium gained 0.5 percent to $731.40 an ounce.
--Editors: Jake Lloyd-Smith, Ovais Subhani
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