MUMBAI (MarketWatch) ? Gold futures fell further in Asian trade Thursday, following a 5.6% slide in the previous session, as uncertainty about the Federal Reserve?s level of stimulus to the ailing U.S. economy had investors reassess the precious metal?s 25% surge of the past two months. Is gold a fool's investment? Liam Denning and Evan Newmark discuss the sudden drop in the price of gold, and why it might be wise to invest in oil producers not oil itself. Gold for December delivery /quotes/zigman/661658 GC1Z -7.97% fell $12.80, or 0.7%, to $1,744.50 an ounce in electronic trade. The dollar was firm following Wednesday?s news of an unexpected surge in U.S. orders for durable goods in July. Now investors await weekly jobless claims to provide clues on whether the central bank might announce further purchases of U.S. debt to support the economy. On Monday, gold hit a record settlement at $1,891.90 an ounce. But it lost more than $30 on Tuesday and then plunged $104 Wednesday, its worst drop in nearly three and a half years. Gold?s 25% surge over the past two months ?reflected the market?s concerns about fiscal finances, the outlook for the global economy and inflation, but most importantly the belief that the U.S. dollar was headed lower,? said Kathy Lien, director of research and analysis at GFT, in a note. Evidence that the U.S. economy was again losing steam has fueled concerns about a possible double-dip recession, leading Federal Reserve Chairman Ben Bernanke earlier this month to vow U.S. interest rates will stay near zero over the next two years. But a third program to buy U.S. debt and further pressure rates remains an open question. Investors will now key in on a much awaited speech by Bernanke at a yearly summit in Jackson Hole, Wyo. this Friday. Thin August trading and uncertainty about what the Fed Chairman might say gave an opportunity for gold investors to book profits this week, analysts said. ?We maintain our view that gold will peak with the beginning of monetary tightening in the U.S.,? BNP Paribas wrote in a note. ?In our current forecast, this occurs in 2013, but a move in rates could take place earlier should economic conditions improve more quickly than currently expected.?
