Gold settles higher on weak U.S. dollar

CHICAGO, Jan. 16 (Xinhua) -- Gold futures on the COMEX division of the New York Mercantile Exchange inched higher on Tuesday as the U.S. dollar index tried to end days of decline.

The most active gold contract for February delivery rose 2.2 dollars, or 0.16 percent, to close at 1337.10 dollars per ounce, reaching a new four-month high.

The U.S. dollar had fallen broadly against major competitors, especially the euro, pushing up the prices of gold significantly last week.

During the morning session on Tuesday, gold futures continued the upturn but at a lower pace, as the U.S. dollar index managed to rally. The gauge of the dollar against a basket of other major currencies, rebounded 0.12 percent to 90.56 as of 1825 GMT, curbing the momentum of gold.

However, some analysts said the dollar's gains on Tuesday morning was nothing more than a pause. The U.S. currency would be even weaker if it weren't a key reserve currency.

Gold and the dollar typically move in opposite directions. A weaker dollar can boost the appeal of gold as an investment. When the dollar gains, gold tends to drop.

As for other precious metals, silver for March delivery rose 4.8 cents, or 0.28 percent, to settle at 17.189 dollars per ounce. Platinum for April went up 8.7 dollars, or 0.87 percent, to close at 1,004.90 dollars per ounce. Enditem