Gold holds below 5-week high on weaker dollar

Gold on Tuesday hovered below a 5-week peak hit the session before as the dollar weakened, although the prospect of further U.S. rate hikes curbed gains. 

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            FUNDAMENTALS

* Spot gold had edged up 0.1 % to $1,181.81 an ounce by 0054 GMT. It touched $1,185.80 on Monday, its highest since Dec. 5.

* U.S. gold futures were down 0.3 % at $1,181.90 per ounce.

* The dollar index, which measures the greenback against a  basket of currencies, was down 0.1 percent at 101.85.

* The Federal Reserve should consider trimming its $4.5 trillion balance sheet to help raise interest rates more quickly and reduce the negative impact on the economy of a stronger dollar, Eric Rosengren, president of the Boston Fed, said on Monday.

* Holdings of the SPDR Gold Trust, the world's largest gold-backed exchange-traded fund, fell 1.06 percent to 805.00 tonnes on Monday.

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