Gold prices were higher in Europe on Tuesday, catching an upswing in the form of haven buying.
Spot gold was trading at $US1,292.10 a troy ounce, up 1.2 per cent, in morning European trade -- having hit a 20-week high at $US1,294.18.
Gold is often considered a hedge against social or economic risk and demand for the metal tends to rise during periods of uncertainty.
The recent move by the Swiss central bank to abandon its currency cap against the euro sent shock waves through global markets, prompting a rush of gold buying.
Also in Europe, the region's economy is slack, unemployment is high in many countries, and eurozone consumer prices fell on an annual basis for the first time in over five years. And markets are focused on the European Central Bank, which is poised to head into uncharted territory as it nears a decision Thursday on whether to launch a controversial stimulus program aimed at boosting Europe's fading economy.
"The interesting asset today is gold. Inflation is declining by the minute, but gold remains a safe-haven investment, especially after the SNB decision," ADS Securities chief market strategist Nour Al-Hammoury said.
Other analysts said the metal's haven status is only set to increase.
"Demand for gold should also remain buoyant ahead of the ECB's meeting on Thursday and the elections in Greece at the weekend," said analysts at Commerzbank.
The Greek leftist Syriza party is ahead in the polls over the incumbent center-right, pro-bailout New Democracy; Syriza is opposed to the austerity policies pushed by Greece's international creditors. Furthermore, the coming elections have also put on hold negotiations between Greece and representatives of its international creditors-the European Union, the International Monetary Fund and the European Central Bank, also known as the troika-about a credit line to follow its €240 billion bailout, moves that have unsettled markets.
The rest of the precious metals complex was all higher. Silver was up 1.2 per cent at $US17.885 an ounce, platinum gained 0.5 per cent to be at $US1,267.89 an ounce, and palladium was up 1.6 per cent at 766.74 an ounce.
