Gold fails to find cheer on Akshaya Tritiya

Gold remained below the key $1,200 level on Tuesday, adding to overnight losses, as a rally in global equities and a firmer dollar dented the metal's appeal as a safe haven.

Spot gold was down 0.2 per cent to $1,194 an ounce at 0657 GMT after losing 0.7 per cent on Monday.     “Precious markets declined, as market participants pared back safe-haven exposure in gold,” said ANZ analyst Victor Thianpiriya.

“Risk appetite improved, with traders moving towards U.S. and European equities.”

The dollar edged higher against its peers on Tuesday, drawing support as the euro was pressured by increasing worries that Greece could default on its debt and eventually exit the single currency.

Athens is in negotiations with its eurozone partners and the International Monetary Fund over reforms required to unlock remaining bailout funds. Public sector entities have been ordered to transfer idle reserves to the central bank to help with a cash squeeze.

The Greek crisis would have typically boosted safe-haven appeal for bullion, but the strength in the dollar, along with a sharp rally on Wall Street on Monday, offset any such bids.

Asian stocks were firm after China's latest step to prop up its faltering economy lifted global equities.

Another focus will be U.S. economic data and a Federal Reserve policy meeting later this month for clues on when the U.S. central bank could start raising interest rates.

Russia's gold reserves rose to 39.8 million troy ounces as of April 1 from 38.8 million ounces a month earlier, the central bank said on Monday.

Bullion investors were also watching physical demand in top consumer India, which celebrates on Tuesday the Akshaya Tritiya festival, considered one of the most auspicious days to buy gold.

Supply of the yellow metal into India has risen sharply in the build-up to Akshaya Tritiya, although it remains to be seen if consumers will lap up gold products with their usual enthusiasm, after a drop in gold prices.

The price of gold fell for two straight years to 2014 after a 12-year rally.
 

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