On the Comex division of the New York Mercantile Exchange, Gold futures for March delivery were up 1.32% at USD1,677.75 a troy ounce in U.S. trading, up from a session low of USD1,655.95 and down from a high of USD1,680.95 a troy ounce.
Gold futures were likely to test support USD1,654.15 a troy ounce and resistance at USD1,724.75.
Talk that lawmakers are close to striking a deal that will steer the economy away from the fiscal cliff, a potentially recessionary combination of tax hikes and spending cuts due to take effect at the close of 2012, sent gold prices soaring.
Sticking points between the White House and congressional Republicans include tax rates on top U.S. earners and the scope of public spending cuts, though hopes President Barack Obama will announce progress to avoid the fiscal cliff later Monday sparked a rally in the gold market, a barometer for appetite for risk.
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