European gold prices drift lower

Gold edged lower in late European trade on Tuesday with funds and investors keeping the next big target of $600 an ounce within short range. Market players remained bullish about the metal, which rose to a new 25-year high of $591.50 on Monday.
A drop in the dollar against the euro also lifted sentiment. "$600 is everybody's target and everyone is confident that it will get there, but nothing goes up in a straight line," a London dealer said.
Gold eased to $586.70/587.60 an ounce by 1503 GMT after rising as high as $590, compared with $588.10/589.00 in New York late on Monday.
The metal's meteoric rise in the recent past has been part of a broader, speculator-led rally in global commodities markets that has also included base metals and crude oil.
Copper and zinc have been among the metals that have been marking a series of record highs this year on the London Metal Exchange, the world's largest non-ferrous metals market.
"Given the overall positive sentiment and an apparent lack of interest to short the marker aggressively, we see further room on the upside," Barclays Capital said in a report.
Gold has surged 38 percent since the start of 2005, of which 14 percent rise came this year.
"The bulls still appear to have the most ammunition at the moment and seem set to test to $600 sooner rather than later as concerns over the dollar, oil and geo-political tension draw investors to the market," said James Moore, precious metals analyst at TheBullionDesk.com.
The dollar marginally fell against the euro on Tuesday, making gold cheaper for holders of other currencies. Oil traded near Monday's two-month highs.
High oil prices fan inflationary fears, and are often a factor that drives investors to seek gold as a hedge.
Geopolitical concerns, such as worries about Iran's nuclear programme, have also driven investors to seek gold, the traditional safe-haven investment.
In other metals, spot silver steadied to trade at New York's level of $11.75/11.78.
Traders began to actively chase silver last month, lifting it to a 22-year high after talk emerged that an exchange-traded fund might be launched soon.
Platinum was at $1,074/1,078 compared to New York's $1,074/1,078. It climbed to a record high of $1,093 on Friday.
Palladium was at $337/341 versus New York's $337/341.