SINGAPORE (Reuters) - Gold retained its gains from a four-day rally on Tuesday and looked likely to rise further as the dollar took a beating on expectations that a hike in U.S. interest rates could be pushed out to September.
FUNDAMENTALS
Spot gold was firm at $1,189.31 an ounce by 2320 GMT. The metal had climbed to $1,191.50 on Monday, the highest since March 6, as it rose for a fourth straight day.
The biggest boost for the jump in gold prices has been the fall in the dollar.
The greenback has been under pressure after the Federal Reserve sounded a cautious note last week on the U.S. economy and the pace of its future rate-hike path.
Consensus expectation for a U.S. interest rate increase has shifted, with most of Wall Street's top banks now expecting the central bank to hold off until at least September, compared with previous expectations of June, a Reuters poll showed.
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Demand for gold, a non-interest paying asset, has been hurt recently on expectations of a near-term rate hike.
A weaker dollar also makes the metal cheaper for holders of other currencies, and increases its appeal as a hedge.
The Fed is "widely expected" to begin raising interest rates this year though the policy path remains uncertain, the central bank's second-in-command said on Monday, appearing to lay the groundwork for a less predictable future.
Traders will be eyeing U.S. data and more comments from Fed officials this week for clues about the economy and the U.S. central bank's monetary policy.
In other industry news, Ivory Coast launched an operation on Monday to shut down hundreds of illegal gold mining sites blamed for violence, unregulated immigration and environmental destruction, the defence and mining ministers said.
Palladium-backed exchange-traded funds saw their biggest weekly outflows since August last week as prices of the white metal reversed the trend of the last two years to fall as gold, silver and platinum rose.
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MARKET NEWS
The U.S. dollar fell for a second straight session against a basket of major currencies on Monday after traders unwound bullish dollar positions on the likelihood that Fed policy will be accommodative over the near term. [USD/]
(Reporting by A. Ananthalakshmi; Editing by Richard Pullin)