Gold slipped on Monday as the dollar rallied against the euro, but investors spooked by renewed turmoil on equity markets are expected to support the market with fresh buying.
Spot gold was at $910.30/912.30 an ounce at 1102 GMT compared with $922.10 an ounce late in New York on Friday. The precious metal fell 3 percent last week, but has held above $900 on buying by gold-backed exchange traded commodity funds.
Equity markets were down after Washington rejected plans to restructure U.S. automakers General Motors and Chrysler for more government aid, pushing them closer to bankruptcies that could deepen the U.S. recession.
"Tendencies on equity markets and the dollar will be the dominant factors for oil and gold this week," said Barbara Lambrecht, analyst at Commerzbank.
Investors use gold as a hedge against financial uncertainty and inflation, while a higher U.S. currency makes gold priced in dollars more expensive for holders of other currencies.
The dollar rose against the euro after the Bank of Spain said it would bail out a regional savings bank in trouble because of the slumping property market.
Euro sentiment suffered a blow last week after Germany's Finance Minister Peer Steinbrueck said budget irresponsibility in Europe would damage credibility.
Markets are looking ahead to the April 2 summit of the world's 20 biggest economies to discuss regulation and spending to help end the worst recession since the 1930s.
