Gold drops to four-week low

<p>Gold has fallen to a new four-week low.</p>

Gold has fallen to a fresh four-week low today (May 16th) as the commodity continues to weaken after a rally on Tuesday.

It had been up by one per cent earlier in the week, but has now dropped to $1,369.29 thanks to factors such as higher equity prices and the firmer dollar.

Ric Deverell, global head of commodities research at Credit Suisse in London, told the Financial Times that one of the reasons for the fall in gold's value is that inflation fears have been easing in recent weeks.

He also pointed out that concerns over a markets meltdown due to a eurozone collapse have diminished.

"We're still seeing ETF liquidation. It's driving prices down," said Jim Steel at HSBC in New York.

Brian Lan, managing director of GoldSilver Central Pte Ltd in Singapore, told Reuters earlier in the week that investors are preferring stocks and shares over commodities such as gold at the present time.

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