Gold gains in longest run in six weeks as leaders discuss Greece

[LONDON] Gold gained for a third day, the longest run of advances in almost six weeks, as euro-area finance ministers meet amid an impasse over Greece's financing.

Weekend discussions aimed at identifying common ground failed to make sufficient progress. Greek Finance Minister Yanis Varoufakis aims to secure a six-month bridge package that gives Greece the time and financial space to negotiate a post-bailout settlement. Creditors say the government must abide by agreements struck by previous Greek administrations.

"The ongoing discussions surrounding Greece and the possibility that there could be problems in resolving them are supporting the gold price," Thorsten Proettel, a commodities analyst at Landesbank Baden-Wurttemberg, said by phone from Stuttgart.

Bullion for immediate delivery rose 0.2 per cent to US$1,232.24 an ounce by 3:41 pm in London, according to Bloomberg generic pricing. Gold for April delivery was 0.4 per cent higher at US$1,232 on the Comex in New York. US markets are closed for a holiday on Monday.

Gold rose 4.1 per cent this year after posting two years of losses. Proettel said traders will probably focus this week on the outlook for US interest rates, with the Federal Reserve set to release minutes of its January meeting on Feb 18.

Holdings in exchange-traded products fell for a fourth day as of Feb 13, declining 3.2 metric tons to 1,670.7 tons, data compiled by Bloomberg show. That capped the first weekly drop in a month after assets reached a four-month high on Feb 9.

Silver for immediate delivery fell 0.2 per cent to US$17.3218 an ounce in London. Platinum was little changed at US$1,207.75 an ounce and palladium was also little changed at US$791.55 an ounce.

BLOOMBERG