Dollar Trades Lower; Gold Advances

Benchmark bullion futures were tacking on $3.30 at $907.50 an ounce in recent action on the Comex division of the New York Mercantile Exchange.
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The greenback was pulling back against the other major currencies as oil and gold prices rallied amid heightened tensions in the Middle East.

One euro was buying $1.5635, up from $1.5494 Thursday. The British pound was selling for $1.9738 vs. $1.9733 in the last session, and the the dollar was trading for 107.3 Japanese yen, down from 107.93 yen previously.

Benchmark bullion futures were tacking on $3.30 at $907.50 an ounce in recent action on the Comex division of the New York Mercantile Exchange. Gold prices tend to rise during in times of geopolitical tension.

Large-scale military maneuvers by Israel are being seen as a dry-run for a potential attack on Iran, explains Ashraf Laidi, chief foreign-exchange strategist at CMC Markets in New York.

"The situation is worsened by bellicose response from Iran stating it would answer an Israeli attack with a 'strong blow,' driving oil prices back above $134 per barrel," he writes in a research report.

The New York Times

had an article Friday saying that Israel was conducting military drills American observers think could be a warm-up for bombing Iran's nuclear facilities.

The

CurrencyShares Euro Trust

(FXE) - Get Report

was rising 0.9%. The

CurrencyShares British Pound Sterling

(FXB) - Get Report

was ahead 0.1%. The

CurrencyShares Japanese Yen Trust

(FXY) - Get Report

was up 0.6%.

The

SPDR Gold Trust

(GLD) - Get Report

, which holds solid gold bars, was gaining 0.9%. In the precious metals patch

Barrick Gold

(ABX)

was adding 1.5%.