By Maytaal Angel
LONDON (Reuters) - Gold rose on Tuesday after hitting a six-week low in the previous session as bargain hunting set in and the dollar slid sharply before speeches by U.S. Federal Reserve officials.
Fed officials have signalled that they plan to continue on their current trajectory of interest rate hikes despite a slow down in inflation. But softer-than-expected U.S. data has given rise to some caution.
A huge sell order totalling 1.85 million ounces pushed gold to a six-week low on Monday, although the precious metal ultimately failed to break below the 200-day moving average.
"If yesterday gold wasn't able to push below the 200-day moving average that's a positive sign," said ABN Amro analyst Georgette Boele.
"The market is sceptical about Fed rate rises this year and next. Overall we're optimistic about the outlook for gold, we (see) a weaker dollar later in the year," she added.
Spot gold rose 0.5 percent to $1,250.30 per ounce by 1357 GMT. It hit a near six-week low of $1,236.46 on Monday.
U.S. gold futures for August rose 0.4 percent to $1,250.90 per ounce.
Fed Chair Janet Yellen addresses the British Academy in London at 1700 GMT, after a speech by Philadelphia Fed President Patrick Harker in the U.S. city at 1515 GMT
Before that, the dollar slipped 0.6 percent against major currencies, hitting a nine month low versus the euro after the European Central Bank President said he might begin to reduce the Bank's emergency economic stimulus.
A weak dollar makes dollar-priced gold cheaper for non-U.S. investors.
Gold prices have gained every month this year save June, thanks partly to geopolitical tensions which most recently included Syrian hostilities, a bailout of Italian banks, the policies of U.S. President Donald Trump and Britain's negotiations to quit the European Union.
"The gold market is seeing a bit of a bid right now. Growing tensions in the Middle East may be playing a part," said INTL FCStone's Ed Meir in a note.
The White House warned Syrian President Bashar al-Assad on Monday that he and his military would "pay a heavy price" if it conducted a chemical weapons attack and said the United States had reason to believe such preparations were underway.
Among other precious metals, silver rose 0.3 percent to $16.61 an ounce, while palladium was flat at $864.97 per ounce.
Platinum rose 0.7 percent to $918.75, recovering from Monday's six-week trough.
(Additional reporting by Nithin Prasad and Vijaykumar Vedala in Bengaluru; Editing by Edmund Blair and David Evans)
(Only the headline and picture of this report may have been reworked by the Business Standard staff; the rest of the content is auto-generated from a syndicated feed.)
