• Gold rose for a second day on Tuesday as the dollar slipped in the face of a recovery in global equities, which dampened appetite for the U.S. currency as a safe store of value.
• A retreat in the dollar, in which the precious metal is priced, has helped gold to pull back nearly 2 percent from last week's one-month low of $1,306.81 an ounce.
• Spot gold was up 0.4 percent at $1,328.44 by 1245 GMT, while U.S. gold futures for April delivery were $4.30 an ounce higher at $1,330.70.
• Global equities were up 0.3 percent on Tuesday, with Asian shares rising from two-year lows overnight on the back of an extended rebound among Wall Street stocks after their biggest weekly drop in two years.
• Shares remained under some pressure in Europe, however, indicating caution in the market. Investors are now awaiting U.S. January inflation data, due on Wednesday, for clues on the next move in financial markets.
• Inflation is sometimes seen as gold-positive, because bullion is seen as a safe store of value at a time when price pressures are rising, but expectations that the U.S. Federal Reserve will lift interest rates to fight inflation make the non-yielding metal less attractive.
• "Usually, if these readings are a bit higher than expected, that triggers some expectations for higher rates, which should support the dollar but will weigh on gold if you get yields moving up," ABN Amro's Boele said.
• Among other precious metals, silver was up 0.5 percent at $16.63 an ounce, while platinum gained 0.6 percent to $976.50.
• Palladium was up 0.8 percent at $992.70. The autocatalyst metal has slid nearly 14 percent since hitting a record $1,138 in mid-January but remains at elevated levels on expectations that the market will remain in deficit for a while yet.
Reference: Reuters
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