Despite the dollar’s early struggle against the euro and the British pound, commodities stepped back on Monday as the greenback recovered strength. New York silver, gold and platinum futures lost 1.7 percent, 0.1 percent and 2.9 percent respectively.
December crude-oil added to last week’s 6.6 percent loss and fell hard for the second straight session. It hit a 22-month low with a drop of $2.09, or 3.7 percent, to settle at $54.95 a barrel. According to AAA, the average price for unleaded gasoline fell to $2.087 a gallon.
December silver lost 15.9 cents to end at 9.33 an ounce.
January platinum plunged $24.50 to settle at $820.60 an ounce.
A small slice was pulled away gold’s 5.3 percent gain on Friday. The yellow metal fell slightly by 50 cents to close to $742 an ounce. Its lowest level for the day was at $729.60.
"The dollar has the strength that it does because people are pulling their money home and going to cash," said Frank Lesh, a trader at FuturePath Trading LLC in Chicago. "Gold is just reacting to the dollar. There’s a loss in demand for all metals and commodities."
Gold, considered a hedge during times of high inflation and economic uncertainty, tends to follow oil and move opposite to the U.S. dollar. A rising greenback makes dollar-denominated commodities, like bullion, more expensive for holders of other world currencies. When prices are falling and economic activities are shrinking, gold prices tend to move lower.