Business Day, Australia

theage.com.au

US gold futures ended higher Monday as the US dollar fell further, more than offsetting follow-through weakness and investors' need to raise cash on the back of Dubai's debt woes.

COMEX February gold settled up $US6.80 at $US1182.30 an ounce on the NYMEX, while spot gold was at $US1176.25 an ounce, compared with $US1176.70 late in the previous session in New York.
The US dollar added losses against the euro as economic optimism supports the equities and commodities markets.

Gold investors initially sold to cover losses after worries about Dubai's debt default pressured equities last week.

‘‘Dubai, typically a major gold buyer, could unload bullion holdings to opt for cash, and that adds selling pressure to the market,’’ said Miguel Perez-Santalla at Heraeus.
 
But comments by a senior Chinese official that Dubai's debt crisis could be China's opportunity to snap up gold and oil assets stabilized the market.

 Investor sentiment is still firm after last week's news that Sri Lanka acquired gold from the IMF, and a report that India is open to buying more IMF gold.

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