By Debarati Roy - Apr 18, 2012 3:37 AM GMT+0800

Gold futures advanced from a one- week low as the dollar declined, increasing demand for the metal as an alternative investment.

The greenback fell for the second straight day against a basket of currencies as European debt concerns eased and the International Monetary Fund increased its forecasts for economic growth. The Standard & Poor’s GSCI Spot Index of 24 commodities rose as much as 0.9 percent.

“The dollar’s weakness is supporting all commodities, including gold,” Sterling Smith, a market analyst at Country Hedging in St. Paul, Minnesota, said in a telephone interview.

Gold futures for June delivery rose 0.1 percent to settle at $1,651.10 an ounce at 2:11 p.m. on the Comex in New York. Earlier, the price dropped to $1,635.20, the lowest since April 10. The precious metal has advanced 5.4 percent this year.

Silver futures for May delivery jumped 1 percent to $31.674 an ounce on the Comex. Prices have climbed 13 percent this year.

On the New York Mercantile Exchange, platinum futures for July delivery climbed 0.6 percent to $1,584.70 an ounce. Palladium futures for June delivery increased 1.7 percent to $661.95 an ounce.