Gold ends tad up on soft dollar, ignores down oil

By Frank Tang and Jan Harvey

NEW YORK/LONDON (Reuters) - Gold ended a touch higher on Tuesday, recovering from session lows as buying increased after the dollar softened against the euro following disappointing U.S. economic data.

Gold was at $884.20/885.40 an ounce by New York's last quote at 2:15 p.m. EDT, against $883.60/884.80 an ounce late in New York on Monday.

The precious metal came under pressure in earlier trade as traders took profits after a strong session on Monday, when gold had risen to an intraday high of $894.70 an ounce on the weaker dollar.

A dip in crude prices after Monday's record highs dampened sentiment toward the precious metal, which is often bought as a hedge against oil-led inflation.

"If oil prices are poised for a potential fall, players are going to hold back from buying gold in anticipation of that," said Fairfax IS analyst John Meyer.

Crude slipped after Monday's all-time high of $139.89, as investors took profits ahead of a meeting of oil producers and consumers in Saudi Arabia this weekend. U.S. crude futures ended down 60 cents at $134.01 a barrel.

However, the market was still supported by weakness in the dollar. The U.S. currency slipped against the euro on Monday as U.S. housing starts fell and after in-line producer price inflation numbers.

The data was interpreted as reducing the chances of an early U.S. rate hike from the Federal Reserve.