Spot gold drifted lower in Asia on Monday on the dollar's slight recovery and falls in oil prices, while markets showed little reaction to a suggestion to revile the International Monetary Fund's (IMF) massive gold holdings.
The revaluation, raised at the IMF meeting over the weekend, would be to fund debt relief for poor nations, but many Groups of Seven (G7) nations and gold-mining powerhouse South Africa voiced concern about the idea.
Spot gold was quoted at $417.50/8.00 per ounce against the late on Friday US level of $418.85/9.60.
The spot price found some support as key gold futures traded on the Tokyo Commodities Exchange (TOCOM) rose to there highest since April 1992, although it backed off after meeting substantial profit-taking.
"The idea of gold sales usually comes out when prices are rising, but we've heard similar kinds of proposals several times in the past," said Shoji Seagate, assistant manager at Mitsubishi Corp Futures Ltd.
"Right now the market is more sensitive to oil prices, which have caused the present upturned in gold, rather than reacting to the IMF news," Seagate said.
Key US light crude oil fell on Monday as a surprise peace deal improved security in Nigeria's oil-producing delta, resolving a crisis that had driven crude prices to a record high above $50 a barrel last week.
The key crude oil for November delivery was trading 38 cents lower at $49.74 a barrel in ACCESS electronic trading.
Gold was pressured by firmness in the greenback, which regained strength after the weekend meeting of G7 finance ministers and central bankers produced no market-moving surprises. The dollar rose to 110.81/84 yen against on Friday's late US level of around 110.50 yen.
It strengthened to $1.2368/72 against the euro compared with around $1.2410.
The dollar and oil prices were expected to set the trend for gold, but traders were careful about going short on the yellow metal amid robust demand for buying physical gold.
Top consumer India is entering the festival season of peak demand, and in the Middle East high oil prices have created wealth that is finding its way into gold bar investments.
Silver edged down to $6.87/$6.89 an ounce from $6.89/$6.92 in New York.
Platinum was quoted at $855/$860 an ounce, compared with $858/$862 in New York.
Platinum was under slight downward pressure amid views that strike at the world's two biggest producers, Angloplat and Implants were likely to be short-lived, traders said.
Palladium was at $219/$224 an ounce from $218.50/$223.50 in New York.