Gold crawled higher on Monday on bullish energy prices and slight falls in the dollar, while Tokyo futures prices rallied to a two-week high.

By 0345 GMT, cash gold was trading at $654.40/655.00 an ounce from $653.80/654.60 late in New York on Friday, when it rose more than $4 an ounce.

Fresh funds are flowing into gold as we're in the early part of the third quarter, although the market is still nervous because of uncertainty over the outlook for global interest rates, said Shuji Sugata, manager at Mitsubishi Corp Futures and Securities.

We've seen solid demand at around $640 by Asian buyers, but the market is seeing some technical resistance around


Gold has been supported since dropping to a three-month low of $638.90 on June 27, but its upside is blocked around the 100-day moving average of $663.

In the Japanese market, the key June 2008 gold contract on the Tokyo Commodity Exchange closed the morning session at 2,629 yen a gram, up 23 yen or 0.9 percent from Friday's close.

It matched an intraday high of 2,632 yen reached on June 25.

The move of currencies continues to set the trend for gold. Also the recent strength in oil prices should be positive but gains are pretty much limited so far, Sugata said.

Oil prices eased slightly on Monday after hitting the highest since August on Friday.

But London Brent crude oil remained firm above $75 on strong summer driving demand in top consumer the United States and worries political volatility would cause further supply disruptions in Nigeria, the world's eighth-largest oil exporter.

The dollar hovered near a 4-1/2-year high against the yen but stayed on the back foot against the euro after a rally on Friday inspired by surprisingly strong U.S. employment data quickly lost steam.

Platinum was backed by bullish fundamentals amid wariness over possible labor strikes in South Africa.

Platinum hit a two-week high of $1,294 an ounce before easing to $1,291/1,296 an ounce, still higher than $1,290/1,297 late in New York.

The most active contract on TOCOM's platinum, currently June 2008, rose to its highest in two weeks at 5,105 yen per gram.

Silver was little changed at $12.69/12.72 an ounce.

Palladium rose to $364/369 an ounce from


Precious metals prices at 0353 GMT

Last Net Change Pct Move Turnover (lots)

TOCOM Gold 2628.00 22.00 +0.84 28197

TOCOM Platinum 5092.00 34.00 +0.67 17455

TOCOM Silver 507.40 9.30 +1.87 3180

TOCOM Palladium 1471.00 1.00 +0.07 521

Spot Gold 653.60

Spot Platinum 1290.00

Spot Silver 12.66

Spot Palladium 364.00

Change so far in 2007

Metal Latest bid End prev year Pct Move

TOCOM Gold 2628.00 2445.00 +7.48

TOCOM Platinum 5092.00 4254.00 +19.70

TOCOM Silver 507.40 493.30 +2.86

TOCOM Palladium 1471.00 1255.00 +17.21

Spot Gold 653.60 636.10 +2.75

Spot Platinum 1290.00 1132.00 +13.96

Spot Silver 12.66 12.85 -1.48

Spot Palladium 364.00 332.00 +9.64

Euro/Dollar $1.3623

Dollar/Yen 123.64

TOCOM prices in yen per gram, except for silver which is in yen per 10 grams, spot prices in $ per ounce.

(Additional reporting by Lewa Pardomuan in Singapore)