LONDON, Jan 3: Gold was supported close to six-year price highs on Friday with the dollar remaining weak against foreign currencies and Wall Street posting modest losses, analysts said on Friday.

Spot gold was trading at $346.00/6.60 an ounce at 1533 GMT, up from New York’s last quoted $345.75/6.45 on Thursday and in sight of last month’s surge to $353.75.

In New York, COMEX February gold futures were off 10 cents at $346.40 an ounce.

“Gold is well supported by the current geopolitical events, will keep its eye on the euro and fresh physical demand under $340 should defend the current $335-355 range,” said Andy Maag, analyst at UBS Warburg in Geneva.

A weaker dollar and small losses on the Dow Jones industrial average also prevented deeper losses in the European session.

The dollar posted its biggest one-day rally since August in the previous session while the Dow Jones industrial average scored its biggest point gain ever on the opening day of the year, both combining to dent investor interest in bullion.

Despite its losses in the European session, gold is 24 per cent higher than this time last year, making it one of the best performing financial assets.

“$340-348 should be the range for the moment, with a lack of liquidity adding to the volatility. Monday should see things back into full swing as traders wait for further US data to see if this is the start of the economic recovery,” said James Moore, analyst at London-based TheBullionDesk.com.

Prospects of a US-led war against Iraq early in 2003 also buoyed the metal.—Reuters