Gold Futures Hit Again

Precious metals prices were falling again Wednesday in New York on the back of a rallying dollar.

June-dated gold contracts were dipping $3.90 at $673.40 an ounce in recent action. Silver was dropping 7 cents at $13.30 an ounce.

The bullion exchange-traded funds that own stocks of the metals were slipping as well, with the iShares Comex Gold Trust(IAU Quote) and iShares Silver Trust (SLV Quote) both off about 0.6%.

Helping boost the greenback was a Commerce Department report showing a 3.1% jump in factory orders for March. The consensus forecast was for 2.1% growth. In addition, the figure for February was upwardly revised.

"This was very good news coming right on the heels of Tuesday's strong [Institute for Supply Management] report," says Ellen Beeson Zentner, an economist at Bank of Tokyo-Mitsubishi UFJ in New York. "This pushes worries about the business sector aside, and now we can concentrate on the housing slump and its effect on the consumer."

The recent economic news should strengthen what has been an ailing dollar lately, she says.

Foreign exchange dealers seemed to agree, and they brushed off a weak jobs report from payroll processor ADP. One euro was buying $1.3597, down from $1.3612 in the prior session. The dollar was trading for 120.11 yen, vs. 119.77 yen previously.

The price of precious metals and the value of the dollar tend to move inversely over time.