Gold steady on Middle East support, momentum weak

Gold prices steadied on Wednesday, as escalating unrest in the Middle East and North Africa underpinned the safe-haven demand, but the rise lacked momentum due to easing fears over Japan's nuclear crisis and a modest rebound in the dollar. The troubles in the Middle East turned increasingly violent with Syrian troops opening fire on protesters and Yemen's president warned that the country would slip into civil war if he was forced to quit.

"Gold is still taking its cue from the situation in the Middle East," said Ong Yi Ling, an analyst at Phillip Futures, adding that it could increase safe-haven flows into the precious metal. Spot gold edged down 0.1 per cent to $1,427.85 an ounce by 0329 GMT. US gold futures was nearly flat at $1,428. Bullion has been moving in a narrow range of $4 in the past two sessions, lacking momentum for a further rise on easing fears over Japan's nuclear crisis, even though the battle to contain the problem was ongoing. Profit-taking was spotted as prices rose towards $1,430, seen as a key resistance level, traders said. Spot silver inched down 0.1 per cent t at $36.29, just off the 31-year high of $36.40 hit on March 7.