Gold bullion inched higher in Europe during quiet Tuesday trade with prices hot on the heels of the dollar's minor oscillations against the euro, traders and analysts said.
Bullion continues to track minutely the dollar's movements, after soaring to a 15-year high of $430.50 on January 6 as the euro notched a lifetime high against the greenback.
But the yellow metal subsequently fell just under five percent since that peak, as the dollar gained strength on the back of positive US economic data, and comments from eurozone officials that the sharp appreciation of the euro was a concern.
"It was fairly choppy this morning, but it's all died a death since. Still, gold is looking quite strong, supported by the weaker dollar," one trader said.
He said trading on New York's COMEX market, opened after a long weekend, has not made a significant impact in Europe.
Another trader said: "The market is just following the dollar. There's simply nothing happening."
"This is the worst I've ever seen - it's an utter waste of time. I'm sure the big investors are having fun, but the rest are bystanders."
Analysts said they anticipated spot prices to be somewhat volatile ahead of a Group of Seven (G7) meeting on 6-7 February, which is expected to discuss the rise of the euro versus the dollar, and would not rule out gold testing its support of $402.
But the European gold market shrugged off comments made by Austrian central bank governor Klaus Liebscher the previous day that he was optimistic Europe's central banks would renew a five-year agreement which restricts how much gold they are allowed to sell.
The current Central Bank Gold Agreement (CBGA), seen as allowing central banks to dispose of excess bullion without flooding the market, is due to expire in September 2004.
By 1538 GMT spot gold traded at $410.30/411.05, up on London's previous close of $407.00/407.50. The euro gained ground on the dollar to reach $1.2571/79 compared with Monday's session low of $1.2335.
Spot silver eased down to trade at $6.31/6.33, down on London's previously quoted prices of $6.33/6.35. The white metal peaked at a six-year high of $6.72 last Monday, before tumbling 8.32 percent to Friday's low of $6.17.
Platinum traded at $858.00/863.00, unchanged from London's last price on Monday, while palladium traded a touch down at $212.00/217.00 versus London's $213.00/218.00.