LONDON, March 12: Gold gained on Wednesday on a struggling dollar and strong oil prices, and analysts said the metal was expected to trade in range in the near term.

Spot metal rose as high as $977.00 an ounce before dipping to $975.50/976.30 against $971.00/971.80 late in New York on Tuesday.

Gold fell as low as $964.35 on Tuesday, when the dollar rallied after global central banks announced plans to boost liquidity in financial markets.

There is a lot of investor interest in gold right now and investor sentiment is the key driver for gold prices, but physical demand holds them down, said Dan Smith, metals analyst at Standard Chartered Bank.

We expect a broad sideways move in gold prices in the coming months, though long term we are still quite bullish.

Gold is still up nearly 17 per cent since the start of the year, a rally that has dimmed physical buying in key consuming centres, although this week’s consolidation around $970 has stirred demand from jewellers in some parts of the world.

The metal was getting support from the dollar, which eased back towards record lows versus the euro as a pick-up in risk appetite prompted by central bank measures to boost liquidity faded.

A weaker dollar makes gold cheaper for holders of other currencies and often lifts bullion demand. The metal is also generally seen as a hedge against oil-led inflation.

Gold has fallen more than 2 per cent since it spiked to a lifetime high of $991.90 on March 6, but dealers said record high oil prices and expectations of further interest rate cuts in the United States were keeping further losses at bay.

Gold is likely to find strong dip buying interest, however the metal’s failure to rally above $985 suggests the metal is still top heavy and in need of further consolidation, James Moore, said in a market note.

In other metals, platinum fell as low as $2,003 an ounce before rising to $2,042/2,052, against $2,050/2,060 late in New York and a record high of $2,290 hit on March 4.—Reuters