Dip in gold price continues

Gold prices rose on Wednesday as investors used dips to accumulate the yellow metal after it dropped more than one percent to its lowest in over three weeks in the previous session.

Spot gold was up 0.3 percent to $1,328.86 per ounce,as of 0444 GMT. Prices fell over 1 percent to hit its lowest since Jan. 11 at $1,319.96.

Meanwhile in Dubai, gold prices are Dh161 for 24-karat and 22-karat can be bought for Dh151.25.

US gold futures for April delivery rose 0.2 percent to $1,331.60 per ounce.

"Some dip-buying is coming back aggressively as the volatility index drops. Also, some good buying as the shortterm US (interest) rate curve is easing off a bit," said Stephen Innes, APAC trading head for OANDA.

"(Prices are) well above major support and appetite is coming back, with longer-term traders still holding and steadily buying small clips from this morning Comex open."

Asian share markets were trying to find their footing on Wednesday as a semblance of calm returned to Wall Street where major indices bounced into the black after days of deep losses.

Distressed selling by leveraged funds seemed to have run its course at the moment, allowing volatility to slightly abate, though the prospect of monetary tightening across the globe remained a challenge for the long term, analysts said.

Unless the market plunge intensifies and damages the economy, US Federal Reserve policymakers is unlikely to budge from their plan to lift key short-term interest rates three times this year, some analysts said.

However, traders dialled back bets the US central bank would ratchet up the pace on rate increases to between two and three hikes from three to four hikes last week, according to interest rates futures.

Meanwhile, SPDR Gold Trust, the world's largest goldbacked exchange-traded fund, said its holdings fell 1.44 percent to 829.27 tonnes on Tuesday from 841.35 tonnes.