Gold swung between gains and losses and the speculation

Gold swung between gains and losses and the speculation that Europe's problems of debt can be extended beyond Ireland boosted demand for shelter, while the concern that China may take more measures to cool price inflation slowed commodity.

Gold for immediate delivery advanced 0.3 percent to $ 1,370.43 an ounce and fell into the same amount of $ 1,361.90 before trading little changed at $ 1,368.05 at 5:23 pm in Seoul. Prices are set for a monthly gain of sessions. The February contract for delivery also was little changed at $ 1,369.20 in the Comex in New York.

There is no "speculation Spain and Portugal could be the next to ask for help, which caused an increase in safe-haven flows into gold," wrote Mark Pervan, head of commodities research in Australia and New Zealand Banking Group Ltd., in a report released today.

The euro fell to a two-month high against the dollar, while the Spanish and Portuguese bonds fell on speculation that the Irish 85 million euros (113 billion) bailout will not stop the financial contagion. Gold priced in euros hit a record in June, when Greece sought a ransom.

The dollar index, which is the currency against six colleagues, was little changed after rising yesterday to the highest level since 20 September. Gold typically moves in the opposite direction to the U.S. currency.

Curbing inflation

China needs to raise interest rates by 200 basis points to curb inflation as the excess liquidity, Zhong Jiyin, an economist at the China Academy of Social Sciences, wrote in a commentary in today's China Daily.

"Gold seems to be weighed by concerns market that China may raise interest rates," said CS Oh, future team leader abroad at NH Investment & Futures Co. in Seoul. "That seems to be affecting other products."

China, the top user of raw materials, has ordered banks to set aside large reserves twice this month after rising interest rates in October. Consumer prices rose 4.4 percent last month, the statistics bureau reported on 11 November.

The International Monetary Fund said Monday it sold 19.5 tonnes of gold in October to shore up its finances. The sale to cut funding from the lender based in Washington later this month to 2,846.7 tons, said Alistair Thomson, a spokeswoman.

The IMF said that in 2009, 403.3 tons would be made for sale as part of a program of loans at reduced rates to low-income countries. The bank sold 212 tons to India, Sri Lanka and Mauritius. In February, the bank said it would begin "in the market" sales.

Silver for immediate delivery rose 0.3 percent to $ 27.2325 an ounce, set for a fourth monthly advance. The metal has risen 61 percent this year, to $ 29.36 an ounce on 09 November, the highest since 1980.

palladium immediate delivery rose 0.5 percent to $ 694.65 an ounce, heading for a monthly gain of sessions. Platinum for immediate delivery was unchanged at $ 1,647.53 an ounce, ready for the first monthly decline in three years.