Gold prices slipped Tuesday, their seventh consecutive daily decline, to a two-month low as the dollar posted big gains in light trading.

The greenback climbed 0.49 percent to 79.97 on the ICE US Dollar Index, while the single currency fell to a multi-week low. Increases in the value of the dollar inhibit gold buying by purchasers who use non-U.S. currencies, cutting demand and therefore price.

U.S. Treasuries rose on a continued flight to safety, which cut the interest rate on the 10-year bond to 1.98 percent.

U.S. stocks were mixed in late afternoon trading, lifted by encouraging results of a Spanish bond auction and improved economic sentiment in Germany but weighed by November retails sales numbers that did not meet expectations. 

Gold was also weighed by remarks from German Chancellor Angela Merkel who rejected increasing the $655 billion limit for the new bailout fund, known as the European Stability Mechanism.

The 0.3 percent decline in gold's price might have been worse, but for gold-back ETF holdings remaining steady and Indian purchases of physical gold increasing.

Throughout the day's trading session the price of gold on the Comex never strayed above or below a tight $30 band.

Gold on the Comex fell $5.10 to $1,663.10, virtually the same as its Oct. 11 closing price of $1,663. Silver rose 26 cents to $31.26.