Gold holds above one-month low on softer dollar, weak US data

Gold clung to small overnight gains on Tuesday to hold above a one-month low, supported by a softer dollar and weak US economic data that dented expectations of an immediate hike in US interest rates.

FUNDAMENTALS-

Spot gold was little changed at USD 1,221.40 an ounce by 0033 GMT. The metal had fallen to a one-month low of USD 1,208.15 on Monday, before closing the day up 0.4 percent.

Bullion was in demand after the dollar fell on disappointing data on the US economy.

Data on Monday showed US consumer spending barely rose in February and inflation retreated, suggesting the Federal Reserve could remain cautious about raising interest rates this year even as the labour market rapidly tightens.

Following the weak data, economists slashed their first-quarter gross domestic product growth estimates, while the dollar fell 0.2 percent against a basket of major currencies.

Markets will be eyeing a speech by Fed Chair Janet Yellen to the Economic Club of New York. She is due to speak on the economic outlook and monetary policy at 1620 GMT on Tuesday.

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