By Moming Zhou & Myra P. Saefong, MarketWatch
NEW YORK (MarketWatch) -- Gold futures edged higher Monday, bouncing back from their one-month low as the U.S. dollar fell after Abu Dhabi pledged to bail out Dubai, boosting gold's investment appeal.
Investors also await this week's Federal Reserve's monetary policy meeting and a string of U.S. economic data, including figures on industrial production Tuesday and the consumer price index Wednesday.
Gold for February delivery, the most active futures contract, was up $2.90, or 0.3%, at $1,122.80 on the Comex division of the New York Mercantile Exchange.
The December front-month contract gained $4.30, or 0.4%, to $1,123.70 an ounce. It ended at the lowest level since Nov. 13 on Friday, and fell 4.2% last week.
Gold prices "are trading higher as news that Abu Dhabi has bailed out Dubai with a $10 billion cash injection weighed on the dollar," said Natalya Naqvi, a precious metals analyst at Barclays Capital.
"Currency movements are likely to set the tone of trading over the forthcoming sessions."
Abu Dhabi said it has given fellow emirate Dubai $10 billion in financing that will be used to pay part of the debt held by state-owned conglomerate Dubai World and its property unit Nakheel. See Dubai story.
The news boosted Asian and European stocks. In the U.S., stock futures also indicated a higher opening.
Holdings in SPDR Gold Trust (GLD 109.75, +0.43, +0.39%) , the biggest gold exchange traded fund, stood unchanged at 1,116.25 metric tons as of Friday. Holdings reached a record high of 1,134 metric tons on June 1.
In other metals, March silver rose 0.8% to $17.231 an ounce, January platinum gained 0.9$ to $1,435.60 an ounce, and March palladium added 1.1% to $366.20 an ounce.
