July 25, 2006	Tuesday	Jumadi-ul-Sani 28, 1427

LONDON, July 24: Gold slipped to a three-week low on Monday as the dollar climbed against other currencies, but trimmed losses in early European trade on fresh buying from investors and jewellers.

People are still nervous of it on the downside, Simon Weeks, director of precious metals at ScotiaMocatta, said.

If we can hang in here for a couple of days, I would expect some bargain hunting and small physical demand to come in. But at the moment it is relatively quiet, he said. Gold fell 1.3 per cent to $611.50 an ounce, its lowest since June 30, before recovering to $616.40/617.90 by 0920 GMT.

Prices are still down from $619.50/621.00 in New York on Friday when gold dropped nearly 2 per cent. In Japan, the benchmark June 2007 gold futures contract on the Tokyo Commodity Exchange fell 43 yen per gram to 2,330 yen, tracking losses in the US market.

Spot gold climbed to a two-month high last Monday on safe-haven buying as fighting between Israel and Hizbollah guerrillas in Lebanon escalated.

The market could not break out on the upside level. I thinkthat has sent bearish signals to the market, said a dealer in Hong Kong, referring to the heavy selling after gold touched around $636 an ounce last Friday.

Physical trading was slow in parts of Asia, with dealers expecting the gold price to head lower. But trading picked up in India, the world's largest gold consumer, ahead of the busy festival season that starts in a couple of weeks.

In other precious metals, spot platinum fell to $1,202/1,207 an ounce from $1,206/1,212 late in New York, while palladium was up $1 at $302/307.—Reuters