LONDON (Commodity Online) : Gold remained steady in European trade Monday as the dollar recovered amid thin trading ahead of Christmas holidays.
Spot gold was seen trading at $1,112.75 an ounce at 4.00 p.m Indian time U.S. gold futures for February delivery was at $1,114.50 per ounce, on the COMEX division of the New York Mercantile Exchange.
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Last week gold fell below a psychological support of $1,100 to a six-week low $1,094.50 before gaining some ground.
It had risen as high as $1,118.70, still about 9 percent below the record above $1,220 marked on Dec. 3.
Gold's appeal as a safe-haven play came into focus after news spread of a dispute between Iran and Iraq, lifting oil prices as well, which was also supportive for gold as a hedge against inflation.
Meanwhile, the dollar was partly underpinned by concerns about debt problems in Dubai and Greece.
Investors are keeping an eye on Greece after two credit ratings agencies downgraded the euro zone member this month on concerns about its fiscal health.
A firmer dollar usually curbs gold's appeal as an alternative investment and makes the precious metal more expensive for holders of other currencies.
Analysts see bullion prices stalling in the short-term due to weak physical buying and as further dollar strength is expected.
Meanwhile, the world's largest gold-backed exchange-traded fund, SPDR Gold Trust , said its holdings stood at 1,126.611 tonnes as of Dec. 18, up 6.097 tonnes or 0.5 percent from the previous business day. Holdings hit a record high of 1,134.03 tonnes on June 1.
