By Cynthia Lin, MarketWatch
NEW YORK (MarketWatch) -- Gold futures recaptured $1,200 an ounce Tuesday after closing below the key mark in the prior session, rekindling demand from physical buyers.
Gold for August delivery recently gained $12.20, or 1%, to $1,210.9 an ounce on the Comex division of the New York Mercantile Exchange, hitting a new intraday high. The contract slid nearly 1% on Monday.
"Gold prices below US$1,200 continue to be used for physical purchases," analysts at Commerzbank said in a note. "Jewelry demand from Asian countries is also rising again."
Recently, the Vietnamese government took down their ban on gold imports due to high local demand and inflated domestic prices, according to the Commerzbank analysts.
Gold holdings in exchange-traded products rose by 3.1 metric tons to a record 2,100.3 tons across the 19 gold-backed products tracked by Barclays, according to analysts at the bank.
Also lending support to gold prices, Moody's Investors Service slashed Portugal's sovereign debt ratings by two notches to A1 from Aa2, upsetting the recent revival in investor confidence over the global economic recovery. Investors' appetite for risk continued to waver, despite Tuesday morning's oversubscribed Greek debt auction, sending some back to the safety of gold.
