LONDON, Nov 8: Gold eased in Europe on Tuesday as the dollar strengthened against major currencies but dealers said consumer and investor buying were expected to provide support.

Spot gold was quoted at $457.40/458.20 a troy ounce down from $459.10/459.90 last quoted in New York late on Monday. It has fallen by about 5 per cent from its mid-October high of $480.25.

The market is fairly quiet at the moment. I think in the absence of anything else significantly in the market, the dollar is the principal influence, said Peter Hillyard, head of metals sales, Europe, at ANZ Investment Bank.

Gold is certainly under pressure at the moment, he said, adding that prices could fall by a couple of dollars but rise again to around $460 in the next few days.

The dollar surged to a two-year high against the euro and hovered near a 26-month peak versus the yen, breaching key technical levels, as investors bet aggressively on higher US interest rates.

The spread of social unrest in France and pressure from European politicians on the European Central Bank not to raise interest rates in a hurry also undermined confidence in the single currency.

A stronger dollar tends to weigh on commodities like gold because the dollar-denominated goods get costlier for market participants holding foreign currencies.

Gold’s relationship with the euro, although slightly detached compared with earlier in the year, now looks set to add further pressure in the coming sessions as gold remains at risk of liquidation by fund/speculative players, said James Moore.

In other precious metals, spot silver was quoted at $7.53/7.56 a troy ounce, compared with $7.56/7.59 last quoted in the US market.

Platinum prices rose to $930/933 an ounce from $928/932, while sister metal palladium was at $225/228 versus $224/228 in New York.

—Reuters