Gold drops $8.50 per ounce on session

Precious metals prices were lower in New York on Monday as the US dollar gained ground on the euro.

December gold was $8.50 lower to $738.70 per troy ounce, a decline of over 1 percent on the session.

Despite the retreat, Citigroup (NYSE: C) raised its forecast for average gold prices this year from $672 per troy ounce to $684 per troy ounce.

Next year, Citigroup projected, the price of gold will average $800 per troy ounce, while in 2010 it prected that the average price of gold will rise to $820 per troy ounce.

UBS also raised its predicted average for the price of gold.

December silver was also lower, dropping 13 cents to $13.36 per troy ounce, while January platinum fell $14.60 to $1,373.20 per troy ounce and December palladium was $4.65 lower to $364.85 per troy ounce.