Gold Recovers, Sparkles Above $US1600 1st Time This Week

Gold renewed its sparkle on Tuesday, closing above $1,600 U.S. per troy ounce first time this week.

But the number of volume traded remained light as short-term traders remained cautious about big risks before year's end, while long-term traders have locked their books for the year, Reuters reported. This scenario should hold gold prices in a sideways range until 2012.

Investor confidence rose on positive economic indicators from the U.S. and Europe.

Gold for delivery in February grew $20.90, or 1.3 per cent, to close at $1,617.60 an ounce on the Comex division of the New York Mercantile Exchange, after posting a high of $1,620.80 during the session. It was its biggest single-session dollar gain month to date.

December-delivery gold rallied $21.20, or 1.3 per cent, to settle at $1,615.60 U.S. a troy ounce.

Gold dropped below $1,600 per ounce last Wednesday as investors liquidated their investments of the safe haven metal on speculation of a dollar strength rising.

Silver, along with other metals also gained Tuesday. March futures for silver spiked $0.66, or 2.3 per cent, to close at $29.54 an ounce. January platinum futures grew $19.30, or 1.4 per cent, to end at $1,432.90 an ounce, while March palladium added $10.90, or 1.8 per cent, to $628.60 an ounce.