SYDNEY (Reuters) - Gold slid $2 in modest trade on Tuesday, dragged lower by a 2 percent fall in oil prices, while activity was thinned by a Japanese holiday and a steady dollar ahead of U.S. final third-quarter GDP data.
With currencies steady, gold took its cue from falling oil prices that have all but eliminated any talk of inflation -- typically an incentive to buy bullion -- returning in the current economic climate.
Dealers said confirmation of a 0.5 percent fall in final U.S. third-quarter GDP data later on Tuesday potentially could drive more investors into bullion, which has rallied 12 percent in just over two weeks as risk-averse investors seek out a safe haven to end a tumultuous 2008.
"If we see the U.S. dollar resume more of its down trend on the back of those GDP numbers then gold could get a boost," said Commodity Warrants Australia chief analyst Toby Hassal.
Spot gold fell about $3 or 0.34 percent to $844.20 an ounce at 0324 GMT. COMEX gold futures for February were down 0.18 percent to $845.70 per ounce in after-hours trade. The greenback was little changed versus major currencies in early Tuesday trade after having rallied versus the yen a day ago after data showed Japanese exports slumping and a warning from the Bank of Japan the economy is likely to get worse.
It continued its trickle down against the euro as credit conditions eased, while worries over whether or not a bailout of U.S. automakers would fix the economy persisted.
U.S. crude for February delivery fell 59 cents to $39.32 a barrel after diving 6 percent on Monday.
The Tokyo Commodity Exchange was shut on Tuesday for a national holiday.
Spot platinum rose $6.50 to $851.50 an ounce, while spot palladium steadied at $171.00 an ounce.
Spot silver dropped to $10.77 an ounce from $10.81.
