By Sethuraman N R
REUTERS - Spot gold prices edged up on Monday on a weaker U.S. dollar and as investors looked to hedge against inflation.
Spot gold had risen 0.2 percent to $1,350.28 an ounce by 0324 GMT.
The metal rose 2.4 percent last week in its best weekly gain since the week ended Sept. 1.
U.S. gold futures slipped 0.2 percent to $1,353.10 per ounce.
The dollar recovered some ground on Friday, pushing down gold from a three-week peak of $1,361.76.
More From This Section
The dollar index, which measures the greenback against a basket of currencies, fell 0.1 percent to 89.023 on Monday.
"A couple of hours of dollar short-covering is unlikely to change the broader negativity," said Stephen Innes, APAC trading head at Oanda.
"When coupled with inflationary concerns heightening and a probable follow-up correction in equities markets around the corner, gold's safe-haven demand should continue to glitter."
The U.S. currency has been weighed down by a variety of factors this year, including concerns that Washington might pursue a weak dollar strategy and the perceived erosion of its yield advantage as other countries start to scale back easy monetary policy.
"The stronger-than-expected inflation in the U.S., a key driver for gold prices continued to provide some support," ANZ analysts said in a research note.
"Reports on the weekend of charges being laid on several Russians regarding interference in the 2016 US election are certain to raise the political temperature in Washington, which should also see some safe-haven buying emerge."
A 37-page indictment filed by U.S. Special Counsel Robert Mueller charged 13 Russians and three Russian companies for meddling in the 2016 U.S. presidential election. Russia denounced the allegations.
Meanwhile, hedge funds and money managers cut their net long positions in COMEX gold in the week to Feb. 13, U.S. Commodity Futures Trading Commission (CFTC) data showed on Friday.
Trading is expected to be slower than usual due to market holidays in the United States and China.
SPDR Gold Trust, the world's largest gold-backed exchange-traded fund, said its holdings rose 0.39 percent to 824.54 tonnes on Friday from 821.30 tonnes on Thursday.
Physical gold was sold at a discount in India last week for the first time in three weeks as demand for the metal slumped due to a jump in local rates, while the Lunar New Year holiday capped buying at the end of the week elsewhere in Asia.
Among other precious metals, silver rose 0.2 percent to $16.69.
Platinum was up 0.7 percent at $1,004.50, while palladium rose 0.3 percent to $1,047.10.
(Reporting by Nallur Sethuraman in Bengaluru; Editing by Biju Dwarakanath and Joseph Radford)
Disclaimer: No Business Standard Journalist was involved in creation of this content
