Dollar Drifts Lower; Gold Falls in U.S.

Associated Press

The dollar drifted lower in an erratic session Tuesday as interest rates fell in the United States.

Gold prices were mixed, rising in Hong Kong and Europe but falling in late trading in the United States as traders sold the metal to cash in on its recent gains.

Republic National Bank of New York said gold bullion was bid at $323.90 an ounce as of 4 p.m. EDT, down 85 cents from the late bid Monday.

On Monday, the dollar fell sharply and gold staged its biggest advance in nearly two months in a response to problems that led to the appointment of conservators for two savings and loan associations in Maryland.


But there was no further fallout reported in currency or bullion markets Tuesday.

Analysts said, however, that as long as worries continued about the financial system, the Fed would be unlikely to take any steps that would push interest rates higher or reduce liquidity in the banking system.