Gold prices plummet

March 28 | Updated: Mar 29 2005, 05:30am hrs
Gold prices in New York fell to their lowest in more than five weeks as a gain in the value of the dollar eroded the allure of the precious metal as an alternative to US stocks and bonds.

The dollar rose against the euro and the yen on speculation that government reports this week will signal US growth is accelerating. Gold has moved almost in lockstep with the euros performance against the dollar in the past three months, at a correlation coefficient of 0.85. The maximum reading is 1.

The coefficient measures to what degree two variables move in unison. Gold is down on the dollars strength and the euros weakness, said Frank Lesh, a trader and analyst at Rand Financial Services Inc in Chicago.