Gold prices edged up, finding support from Asian demand and a dip in the US dollar.

Analysts warned, however, that sagging oil prices could continue to weigh on gold as they reduce the metal's appeal as a hedge against inflation.

At 1.58 pm, spot gold, which earlier hit a high of 576.40 usd an ounce, was quoted at 574.45 usd, up from from the 572.40 usd level reached when the COMEX market closed in New York yesterday.

Other precious metals were also higher.

Spot silver was up at 11.28 usd against 11.25 usd, platinum rose to 1,072.50 usd against 1,069.00 usd, while palladium climbed to 307.00 usd against 302.00 usd.

'Crude should continue to weigh on gold today. We expect it to continue its recent fall as US inventory data released this afternoon should be up while oil demand should continue to slow down,' said Dresdner Bank analyst Sara-Frederike Weisser.

She added, however, that a weakening dollar
could bolster gold in its fight against falling energy prices.

The dollar was weaker today after data from the US Commerce Department showed the trade deficit hit an all-time high in August as record imports of oil swamped a solid gain in US exports.

Weisser noted that the dollar failed to capitalise on the relatively hawkish minutes of the Federal Open Market Committee's latest policy meeting yesterday.

She added the Fed's Beige Book survey, scheduled for release at 7.00 pm, 'might not be as positive as the FOMC minutes were. This could weaken the dollar' further, in turn adding to gold's appeal.