LONDON, Oct 31: Gold slipped back towards $600 an ounce on Tuesday as oil prices held below $60 a barrel and the dollar bounced, but analysts expect prices to rise over coming weeks as economic worries dominate sentiment.

Spot gold was quoted at $602.40/603.40 an ounce, up from a session low of $598.70 a ounce, but below the $604/605 an ounce seen late in New York on Monday, when it hit a seven-week high of $610.50 an ounce.

Gold is used as a safe-haven investment in times of economic and political uncertainty or when price pressures or inflation expectations are rising, often because of rising oil prices.

But on Monday, investors mostly shrugged off lower crude oil prices and bought gold on worries about slow growth in the US and a weaker dollar.

A break above key resistance in the $607-608 area added momentum to gold's rally.

Analysts say over coming months gold sentiment will be more entwined with the fortunes of the dollar than with oil, where the relationship, although still strong, is waning.

Gold also will be supported by jewellery demand from emerging market countries, but for now some analysts think that interest has been sidelined on speculation that prices are more likely to fall than rise.

On the technical front, gold is holding near the key psychological $600 level, which traders say is a bullish signal.—Reuters