The price of gold was extending gains Tuesday morning even as the US dollar strengthened against a basket of currencies.
Gold for August delivery, the most actively traded contract, added $2.90 to $1,258.60 an ounce. Yesterday, gold gained nearly 3 percent on bargain hunting as the dollar weakened against a basket of major currencies. Investors largely ignored some upbeat data from the U.S. and Europe, which propped up most global equity markets. Some weak manufacturing data out of China, one of the major consumers of gold in the world, also did little to impact gold prices.
Holdings of SPDR Gold Trust, the world's largest gold-backed exchange-traded fund, edged down to 968.30 tons from 969.50 tons.
Meanwhile, the U.S. dollar was trading steady near its one-month high versus the euro, sterling and the Swiss franc. The buck was extending gains versus the yen.
In economic news, euro zone producer prices declined for the second consecutive month in May, largely reflecting weak energy prices, data published by Eurostat revealed. Producer prices slipped 0.1 percent on a yearly basis, after falling 0.2 percent in April. This was the second consecutive fall in prices. Economists had forecast prices to remain flat in May. Month-on-month, producer prices fell 0.3 percent, which was slower than the 0.6 percent decline seen in April. But the rate of decline slightly exceeded the consensus forecast of 0.2 percent.
British construction sector activity expanded for a second consecutive month in June and at the strongest pace in over a year, a survey report from Markit Economics and the Chartered Institute of Purchasing & Supply showed. The headline purchasing managers' index rose to 51 in June from 50.8 in May. The June reading was the highest since May 2012.
Elsewhere, the price of silver was moving higher and platinum ticked lower in morning deals.
From the U.S., the Commerce Department will release its factory orders report for May at 10 a.m ET. The consensus estimates call for a 2 percent increase in orders following a 1 percent increase in April.
The U.S. automakers are scheduled to release their sales results for the month of June. Economists expect the total vehicle sales to come in at a seasonally adjusted annual rate of 15.5 million compared to 15.3 million in May.
