SINGAPORE (Commodity Online) : Gold prices extended gains in Asian trade Tuesday mainly on geopolitical tensions that boosted its appeal as a safe haven investment asset.
Gold for immediate delivery was seen trading at $1222.11 an ounce at 11.30 a.m Singapore time while U.S. gold futures for August delivery was at $1,220.40 an ounce.
The precious yellow metal advanced for the seventh day in succession as the threat to growth from Europe's sovereign debt crisis and Israel's attack on a civilian flotilla off Gaza increased demand for the metal as an investment haven.
Gold also took advantage on news that China's official purchasing managers' index (PMI) fell to 53.9 in May from 55.7 in April, close to analyst's forecasts of 54.0.
The U.S. dollar was steady in thin trade on Tuesday waiting for direction when forex dealers return to work after the Memorial Day long weekend.
Bullion has gained 8.3 per cent the past two months and reached a record $1249.40 on May 14 on concern European measures to cut deficits and contain sovereign debt risks will curb growth in the region and weaken the euro.
Meanwhile, Holdings in the SPDR Gold Trust, the biggest exchange- traded fund backed by bullion reached a record 1267.93 metric tons on May 27.