Gold futures erased slight gains as pressure mounted from a strengthening U.S. dollar.
The most actively traded contract, for February delivery, recently was down $2.90 U.S., or 0.2%, at $1,368.10 U.S. a troy ounce on the Comex division of the New York Mercantile Exchange.
The pullback came as the euro fell to a session low against the dollar. The rising greenback pressured dollar-denominated gold by making it more expensive for buyers using other currencies, hurting demand.
The ICE Futures U.S. Dollar Index was recently up 0.5% as the euro lost favor following a five-notch ratings downgrade of Irish sovereign debt and International Monetary Fund budget warnings about Ireland weighed on the common currency.
The heads of government agreed to ensure "adequate financial support" in the euro-zone's temporary emergency lending facility, although there are no plans for an immediate increase in the 440-billion-euro fund.
The leaders said there is no need for a greater lending capacity at present, but their comments come amid mounting concern that Portugal and Spain may need a financial rescue package.
Gold had been slightly higher earlier in the day as some participants were buying back previously sold positions. The dollar was lower at that time after strong German economic data boosted sentiment toward the euro.
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