1st LD Writethru: Gold hits 3-month low as dollar nears highest level in 11 years

Gold futures on the COMEX division of the New York Mercantile Exchange fell on Wednesday as the U.S. dollar strengthened, nearing its highest level in 11 years.

The most active gold contract for April delivery fell 9.5 U.S. dollars, or 0.82 percent, to settle at 1,150.60 dollars per ounce.

Gold was put under high levels of pressure as the U.S. Dollar Index, a measure of the greenback against a basket of major currencies, rose on Wednesday by 1.21 percent to 99.86 at 12:55 p. m., nearing its highest level in 11 years.

Gold and the dollar typically move in opposite directions, which means if the dollar goes up, gold futures will fall as gold, measured by the dollar, becomes more expensive for investors.

Analysts and investors have begun to speculate that the U.S. Federal Reserve may remove the word "patient" from their statement after the next Fed meeting. This would open up the possibility of a rate increase as early as June, analysts say. This is a sign of a much-improved U.S. economy, as the rates have been near-zero since around 2009.

The meeting of the U.S. central bank is scheduled for next week, and the Fed members have sequestered themselves from making public speeches until that meeting. Many analysts believe that a possible rate hike began being factored into market prices on Wednesday.

Silver for May delivery fell 26.8 cents, or 1.71 percent, to close at 15.365 dollars per ounce. Platinum for April delivery dropped 14.6 dollars, or 1.29 percent, to close at 1,115.40 dollars per ounce. Endite