Gold prices inched up on Monday in the first trading day of the second quarter, waiting for fresh cues from the currency market as investors digest data from China and the United States as well as developments in the euro zone. The dollar index hovered above a near one-month low hit last Friday after the euro rallied on hopes that Spain could stick to an austerity plan.
Gold has largely been taking its direction from the currency market in recent weeks in an otherwise listless range play. "There is no fresh topic in the gold market these days," said a trader at a large bullion house based in Tokyo. Gold moved towards $1,700 last week after the US Federal Reserve Chairman Ben Bernanke hinted of the possibility of more pro-growth measures, but momentum faded quickly and prices dipped to below $1,650.
Spot gold edged up 0.1 percent to $1,670.30 an ounce by 0645 GMT, after posting a 6.6-percent rise in the first quarter. Although prices fell 1.6 percent in March, a second straight month in the red.
COMEX June contract was flat at $1,671.90 an ounce in thin trading. Most participants in the physical market remained sidelined. "Gold is also lacking sufficient investment enthusiasm to be able to sideline the physical market as it did earlier in the year thus, in turn, prices are struggling to gain momentum," said Barclays.
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