Gold ticked higher on Monday, trading less than $10 shy of last week's record high, underpinned by worries about the global economy after the G20 summit and U.S. comments that Iran has fissile material for two atomic bombs.
Gold saw support from fears about the durability and pace of the global economic recovery, unallayed after the weekend's G20 summit in Canada, and comments from the head of the CIA that Iran may have enough fissile material to make two atomic weapons, and could build the first in two years.
The underlying safe haven concerns that have supported prices -- the economic environment, Europe's fiscal outlook and the longer term prospects for inflation, remain, said David Moore, commodities strategist at Commonwealth Bank of Australia.
The G20 hasn't had a significant impact on markets, and while concerns about Iran's nuclear capacity are nothing new, there seems to be additional clarity.
Spot gold rose $1.80 to $1,255.20 an ounce by 2:28 a.m. ET after a steady performance last week during which bullion struck a record high just below above $1,265.
Gold could rise further to surpass the June 21 record at $1,264.90 per ounce to touch $1,270, as bullish momentum is strong, according to Reuters technical analyst Wang Tao.
He noted the bulls were taking control with prices in an ascending channel from a $1,224.30 low struck last Wednesday and sharp rises and mild falls.
U.S. gold futures for August delivery rose 10 cents to at $1,256.30 an ounce.
The world's largest gold-backed exchange-traded fund, SPDR Gold Trust (GLD.P) said its holdings remained unchanged at an all-time high at 1,316.177 metric tons.
U.S. lawmakers hammered out a historic overhaul of financial regulations, handing President Barack Obama a major domestic policy victory.
The U.S. regulations are pretty worrying. That's something that we will need to look at more closely, a commodities trading source in Singapore said.
So far, people are taking a wait-and-see attitude and it's hard to assess the impact on prices.
Dozens of House Democrats had threatened to vote against a ban on swaps trading on grounds the trade would move overseas.
Instead a compromise solution allows banks to stay involved in foreign-exchange and interest-rate swaps dealing, which form the bulk of the $615 trillion over-the-counter derivatives market.
They also could participate in gold and silver swaps, but they would need to spin off dealing operations that handle agricultural, energy and metal swaps.
Platinum rose 0.9 percent to $1,581.00 as worries about output in the world's biggest producer, South Africa, continued to underpin prices.
Analysts had worried the soccer World Cup could overtax South Africa's electricity network, cutting power to mines, and at the same time, workers at state power generator Eskom are in the midst of pay talks, adding to the threat of supply disruptions.
(Editing by Clarence Fernandez, Himani Sarkar)