LONDON (AFP) - With markets falling and prospects for world growth souring, everything should be in place to send the price of gold, the ultimate safe-haven asset, soaring. Just weeks ago, this was true. On September 2, gold reached an all-time high level of $1,921. But instead of maintaining its new heights, gold has lost just over 20 percent of its value to hit $1,532.72 only three weeks later, its lowest point since July, reached without any signs of a rebound in the world economy. But to Stephen Briggs, an analyst at BNP Paribas, the drop in price is very much in line with golds status as a shelter for rainy days. Gold, in some extent, is still a safe-haven: people buy gold partly as an insurance policy against rainy days, and that rainy days have come, and some investors cash their insurance policy, Briggs said. There is no point having an insurance policy unless you can use it, he said. And cashing in on gold means cashing out in dollars. Mirroring the fall in gold, is the rise of the dollar, itself a safe-haven currency despite recent downgrade of US government debt by the Standard & Poors credit agency and a slowing economy. To Ross Norman, chief executive of gold-trading firm Sharps Pixley, a strong dollar makes gold expensive to those not in the US and consequently gold falls. And with gold having hit such dizzying heights this year as global shares slumped positions in gold have seen profit-taking, Norman said. The pillars supporting high gold prices have collapsed, said Julian Jessop, Chief Global Economist, at think-tank Capital Economics. First, demand for gold as an inflation hedge has fallen as the global economy has slowed and other commodity prices have tumbled, Jessop explained. Second, the more general return of confidence in the dollar has reduced demand for gold as a hedge against a collapse in the US currency, he said. Investors, desperate for the most liquid of assets in these uncertain times, are making huge moves towards the dollar and US bonds, one of the most exchangeable investments in the world. Gold is less liquid in comparison. This is especially true after the worlds largest futures market, CME, upped the price of entry for investing in gold by raising collateral requirements to 21 percent. In the third increase in two months, speculative investors must now pony up $11,475 per benchmark ounce to open a position in gold. The CME move has clearly worsened the downward trend, Briggs said. But we still view gold performance as relatively strong, its really resilient, he added.