SAN FRANCISCO (MarketWatch) � Gold futures broke off a two-day losing streak on Tuesday, rising on a lower dollar after Greece reportedly neared a deal that would pave the way to more international financial aid to the embattled euro-zone country.
Gold for April delivery �rose $23.50, or 1.4%, to settle at $1,748.40 an ounce on the Comex division of New York Mercantile Exchange.
It overcame a weak start, picking up momentum as the dollar turned lower on the Greek reports. Investors also parsed U.S. Federal Reserve Chairman Ben Bernanke�s hearing in Congress.
�We are showing a quite strong rally in the gold market� as Bernanke�s statements continued to indicate more monetary easing �and also on hopes for Greece,� said Jim Steel, a precious metals analyst with HSBC in New York.
Investors hoped the situation in Greece would soon be resolved, which pushed the euro EURUSD �higher against the dollar, he added.
Echoing comments made before Friday�s strong U.S. jobs report, Bernanke said the economic outlook remains �uncertain,� signaling the Fed chairman was not backing away from a recent Fed pledge to keep interest rates near zero until at least 2014.
A rally for oil and gold�s technical position also helped Tuesday�s gains, Steel said. It was key that gold held above $1,700 an ounce despite the recent weakness, he added.
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The metal ended lower Monday, pressured by a higher dollar and moving alongside stocks and other commodities, with the uncertainty surrounding the Greek situation failing as a catalyst.
On Tuesday, Greece was reportedly close to an agreement with lawmakers on additional austerity measures seen key for a deal with bondholders and any further aid from the international community. Read story on Greece.
Hopes of a Greek deal pushed the euro to a two-month high. The dollar index DXY , which compares the U.S. unit to a basket of six currencies, reversed course mid session and traded lower, at 78.627, compared with 79.064 late Monday. Read more on currencies.
Risks about Greece and the euro zone remain, however, analysts at Commerzbank said in a note to clients. But they would still be beneficial for gold, as the �debt-ridden country (would not) receive any further bail-out package which would inevitably lead to Greece�s bankruptcy. Gold should therefore remain well supported,� they said.
Other metals tracked gold higher, with copper turning positive towards the end of the session.
March copper �rose 1 cent, or 0.3%, to $3.88 a pound.
March silver �added 44 cents, or 1.3%, to $34.19 an ounce.
Platinum for delivery in April �advanced $25, or 1.5%, to $1,654.80 an ounce.
Palladium for March �veered between small gains and losses, but ended $3.20 higher, or 0.5%, at $709.15 an ounce.
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