Gold may decline a second day on dollar gain, China

The dollar gained as much as 0.4 percent against the euro. Gold typically moves inversely to the greenback.

"The euro's performance may drag gold down," said Bernard Sin, the head of currency and metals trading at gold refiner MKS Finance SA in Geneva.

Gold for immediate delivery lost US$2.85, or 0.3 percent, to US$1,120.70 an ounce at 9:29 a.m. local time. Bullion for April delivery was 0.3 percent lower at US$1,120.60 on the New York Mercantile Exchange's Comex unit.

Bullion is up 2.2 percent this year after gaining 24 percent in 2009, a ninth consecutive increase. Tuesday is the one- year anniversary of a 12-year low for the Stoxx Europe 600 Index of equities, since when the index has soared 62 percent as governments and central banks around the world maintained low interest rates and committed more than US$12 trillion to stimulate the economy.

Among precious metals for immediate delivery in London, silver fell 0.9 percent to US$17.085 an ounce. Platinum slid 0.6 percent to US$1,588.75 an ounce, and palladium dropped 1.5 percent to US$465.50 an ounce.

Platinum demand may outstrip supply by 68,000 ounces this year and a deficit may continue for the next few years, MF Global Ltd. analysts including Andrew Gardner said Tuesday in a report.

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