Gold prices rises up, but remains near 11-week low
London (Jun 9) Gold added to small overnight gains Tuesday, helped by a weaker dollar, but the metal remained near an 11-week low as investors fretted over the timing of a US interest rate increase.
Spot gold edged up 0.54 percent to $1,179.90 an ounce by 05:10 pm Beijing time after gaining 0.2 percent in the previous session.
The metal had fallen to $1,162.35 Friday, its lowest since March 19, after robust US payrolls data bolstered expectations the Federal Reserve would raise rates in September. Higher US rates could curb demand for non-interest-paying bullion.
Gold was able to hold above that low as the dollar dropped back.
"[A weaker dollar] helped push gold prices higher, although the outlook for the precious metal remains weak," said ANZ analyst Victor Thianpiriya.
Other traders noted that gold's failure to push much higher despite the slide in the dollar against the euro and the yen showed underlying weakness in the metal.
Investor positioning continued to reflect bearish sentiment. Holdings of SPDR Gold Trust, the world's top gold-backed exchange-traded fund, are at their lowest since mid-January, undermining any gains in the metal.
Bullion found some support from uncertainty over the Greek debt crisis.
Greece proclaimed a new willingness to compromise with its international creditors Monday, as German Chancellor Angela Merkel warned that time was running out for a reform-for-aid deal to keep the country in the euro.
A failure to agree a deal could trigger safe-haven bids for gold.
"Greek headlines ... should provide the market with support but technical resistance at $1,185 is likely to remain top heavy," said MKS Group trader Jason Cerisola.