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Gold Steady Above $1,650

4/17/2012 7:03 AM ET

The price of gold was ticking up Tuesday morning as the US dollar edged down after Spain raised debt above its maximum planned target, albeit at a higher cost.

Gold for June delivery, the most actively traded contract, edged up $6.60 to $1,656.30 an ounce. Yesterday, gold ended lower on euro zone concerns with yields at the Spanish bonds auction crossing the crucial 6 percent mark.

Holdings of SPDR Gold Trust, the world's largest gold-backed exchange-traded fund, were unchanged at 1,286.17 tons.

Meanwhile, the U.S. dollar was leveling off from its 2-month high versus the euro and moving lower against sterling. The buck was ticking lower against the Swiss franc, while edging up versus the yen.

In economic news, euro zone annual inflation for March was revised up to 2.7 percent from 2.6 percent, final data from Eurostat showed. The rate was 2.7 percent in February. Inflation continues to stay above the European Central Bank's 'below, but close to 2 percent' target.

Meanwhile, U.K. inflation increased for the first time in six months in March driven by higher food and clothing prices, denting hopes of another round of quantitative easing. Annual inflation rose unexpectedly to 3.5 percent from 3.4 percent in February, the Office for National Statistics revealed. Economists had expected the annual rate to hold steady at 3.4 percent.

Elsewhere, the Mannheim-based Centre for European Economic Research (ZEW) said Germany's economic sentiment improved for the fifth straight month in April The indicator of economic sentiment rose to 23.4 in April from 22.3 in March. Economists had expected the index to fall to 19.

Elsewhere, the prices of silver and platinum were ticking higher in morning deals.

From the U.S., a report on housing starts and building permits is slated to be released by the Commerce Department at 8:30 am ET. Economists estimate housing starts for March to come in at 700,000 each, while building permits are expected to have declined to 713,000. In February, housing starts and building permits came in at 698,000 and 717,000, respectively.

by RTT Staff Writer

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