Gold rose in choppy trade on Tuesday, posting its biggest monthly rise since August on global economic unease and the US Federal Reserve's long-term outlook for near-zero interest rates. The metal recovered after briefly turning lower due to a euro drop amid renewed Greek debt concerns and as disappointing consumer confidence and business activity pressured US equities.
Heavy trading of some ultra-bullish option plays indicated some investors expect the metal's price could rally to a new record this year, traders said.
Gold was up 11 percent in January, as a lack of progress in resolving the European debt crisis pulled in investor. Also, supportive was the Fed saying last week it was ready to offer the economy extra stimulus and would likely keep rates near zero until at least late 2014. Gold was up 0.5 percent at $1,738 an ounce by 3:14 pm EST (2014 GMT), having earlier touched $1,747.39 - its highest since mid-December.
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