The precious metal extended its fall for the fourth day as the U.S. dollar advanced against majors after president-elect Obama's stimulus plan which gave confidence to investors that the U.S. can recover faster than the other major economies. In addition, India, the world largest buyer for gold, reduced its imports which dropped 81% in December, the thing that put more pressure on gold prices. Also oil inched 79 cents but it is expected to incline as geopolitical tensions escalates in the Middle East. So far, the metal reached a high of $859.15 an ounce, losing 0.8% after yesterday's 2% shed.

Crude oil is steady above $48 a barrel with investor's eyes on the Israeli invasion to Gaza and OPEC's promised cut. The Israeli troops are reinforcing their ground assault on Gaza which is heightening threatens of possible supply disruptions from Middle East which accounts for third of the world production. On the other hand, OPEC members pledged to cut their production by 2.46 million barrel which was agreed upon in the previous meeting in Algeria. Moreover, the oil cartel members are going to meet next month in Kuwait to discuss oil prices. Up till now, oil prices recorded a high of $48.89 a barrel and a low of $48.00 a barrel resulting in a shed of $0.79 a barrel.

The greenback is continuing its successful start of the New Year as it advanced against majors. Analysts expects the currency to advance more against the euro and pound on speculations the BOE will slash their benchmark interest rate this week. The U.S. dollar may gain more as no further interest cuts are expected to occur since the currency has reached its minimum while the European nations may adopt more expansionary monetary policy to halt the undergoing slowdown. Thus, the dollar's spike reduced the demand on gold as a safe haven against the falling dollar.