Sydney, Feb 13: Gold showed further modest declines on Tuesday after losing steam in active Europea

Sydney, Feb 13: Gold showed further modest declines on Tuesday after losing steam in active European and North American markets on a stronger dollar, countering some expectations that geopolitical worries might drive bullion toward $700 an ounce.

Spot gold was last quoted at $661.00/661.40 an ounce versus $661.40 in late New York trading.

Investors on Monday were initially seen putting more money into gold as tensions were seen increasing in the Middle East after European Union foreign ministers agreed on sanctions on Iran to raise pressure over its nuclear program.

Gold rose as high as $668.20 an ounce in early Monday trading, prompting forecasts of prices zooming as high as $700 an ounce, before starting to ease in Europe amid some profit taking.

''What we saw was a classic bout of profit taking, which ended the run,'' a dealer said.

Currency markets were also favouring bullion sellers as the U.S. dollar rose against the euro on Monday and neared a four-year peak against the yen.

In contrast, some yen-denominated gold futures on the Tokyo Commodity Exchange rose above 2,600 yen per gram on Tuesday as the yen weakened against the dollar -- the highest for any benchmark contract since September 1985.

Silver rose 2 cents from the late New York quote to $13.66/13.71 an ounce.

Platinum gained $2 to $1,188/1,193 an ounce.

Palladium was up $1 at $334/339 an ounce.

Reuters