Gold prices drop as precious metals buyers respond to rising dollar

Gold prices declined on July 23, as precious metals buyers were impacted by an increasing value for the U.S. dollar.

August gold had declined 0.8 percent to reach $1,570.30 an ounce by 8 a.m. on the Comex in New York, according to Bloomberg News. Bullion for immediate delivery was trading down 0.8 percent at $1,571.20 in London.

Spot gold declined to as low as $1,568.04 per ounce before paring these losses to reach $1,570.04 an ounce at 11:27 GMT, Reuters reports. August Comex gold was trading at $1,570.50.

The dollar rose to its highest value against the euro in two years as the yields of 10-year Spanish notes rose to their highest value since the euro zone was created, according to Bloomberg News.

"The great danger for the gold price is the stronger dollar, because of its long-term negative correlation to gold. That's definitely still dampening the interest of investors from the United States," Commerzbank analyst Eugen Weinberg told Reuters. He added that "It's more about dollar strength than gold weakness."