By Pratima Desai
(Reuters) - Gold rose on Monday towards the 11-week highs hit last week as worries about the political landscape in the United States and Europe and a subdued dollar reinforced investor interest.
Spot gold > rose 0.2 percent to $1,222.74 an ounce by 1106 GMT, having earlier hit $1,225.06, within touching distance of last week's peak of $1,225.30. U.S. gold futures
Political uncertainty in the United States has been fuelled by President Donald Trump's policies, the most controversial of which is a temporary ban on immigrants from seven mostly Muslim countries.
Elections in the Netherlands, France and Germany this year are also adding to jitters.
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"The initial euphoria of the Trump presidency seems to be fading and the elections in Europe are making people nervous. The uncertainty does mean upside for prices," said Warren Patterson, commodities strategist at ING.
"Since the start of the year we've seen the dollar consistently weaker, but physical demand from (top consumers) China and India is still weak and a negative for gold."
China's net gold imports in December, at 51.51 tonnes, were down 60 percent from December 2015.
Meanwhile, gold demand in India fell 21.2 percent in 2016 from the previous year to 675.5 tonnes as new rules such as those forcing customers to disclose their tax codes for purchases above 200,000 rupees ($2,967) dampened demand.
The dollar's value against a basket of currencies <.DXY> has fallen nearly 4 percent since Jan. 3.
That is partly because of expectations that the U.S. central bank will wait to see what happens on political and economic fronts after Friday's monthly jobs report showed wages barely rose.
"The U.S. Federal Reserve is likely to wait a while before next raising interest rates -- our economists expect this to happen in June," Commerzbank analysts said in a note.
Investor interest in gold can be seen in data from the U.S. Commodity Futures Trading Commission (CFTC), showing speculators raised their net long positions in COMEX gold to the highest in eight weeks in the week to Jan. 31.
Technically, gold needs to close above the 100-day moving average at about $1,220 to gain upward momentum. However, traders say that strong resistance at $1,229, a Fibonacci retracement level, could take several attempts.
Spot silver > rose 0.5 percent to $17.55 an ounce while platinum > was up 0.3 percent at $1,006.16 and palladium > added 2 percent to $761.03.
(Editing by David Goodman)
Disclaimer: No Business Standard Journalist was involved in creation of this content
