Gold retreats from 3-month high on profit taking

Gold retreated from 3-month high as the remarkable rise over the past four sessions emboldened profit-taking behavior by investors.

The shiny metal benefited yesterday from the improvement in the sentiment after German business confidence rose to seven-month high and U.S. jobless claims remained at four-year low bolstered demand on commodities and shares.

Data released today from Germany showed that fourth quarter GDP remained unrevised at 1.5%.

Precious gold is probably heading for a weekly advance thanks to Greece which was granted an approval for a second bailout this week which would prevent the debt-mired nation from relapsing into default as the 14.5 billion euros due on March 20 are now restructured by private sector bondholders.

On the other hand, the drop in the U.S. dollar helped dollar-denominated commodities to advance.

Spot gold is currently around $1777.60 an ounce, after touching a high $1781.97 while the day's low was recorded at $1774.75.

Crude oil is also showing some decline after the rise nine consecutive sessions, to trade around $108.50 a barrel, compared with the day's opening of $108.57.

The dollar index, which tracks the dollar movements versus six major currencies, rebounded slightly to hover around 78.68 from the day's opening of 78.64.

This weekend, eyes will be on G20 meeting, while EU summit is due next week.