Spot gold prices gained $2 overnight in Asia to reach their highest London opening in a month above $666 per ounce.

Versus the Euro, spot gold broke above €499 per ounce – the three-day high it failed to hold on Tuesday.

For Sterling-based investors wanting to buy gold, the metal began the London session above £337 per ounce.

"Gold continues to wobble around the tight ranges, and only a break out from the ranges would clear the price direction in the future," said Pradeep Unni, a Dubai analyst for Vision Commodities, to Reuters earlier.

"Though physical buying seldom ignites a rally, it surely serves as a base at which consumers get increasingly confident of price stability."

Physical demand is due to turn higher in April as the India wedding season leads into the spring festival of Akshaya Thrithiya – the third most auspicious day in the Hindu calendar.

This festival packed Bangalore’s 2,000 gold shops “choc-a-bloc” last spring according to press reports at the time. Across southern India, 70,000kg of gold jewellery was sold in one day. (To learn more, click here now...)

Meantime in the oil market, crude prices were static after dropping 2% on news a possible resolution to the UK-Iranian stand-off.

Both sides want an "early resolution" to Tehran's seizure of 15 British service personnel "through direct talks" said Tony Blair, the UK prime minister, late on Tuesday

"Since the recent spike [in oil] followed the escalation of tensions, the de-escalation of tensions simply has to push the price lower," says Dariusz Kowalczyk, chief investment strategist at CFC Seymour in Hong Kong.

Yet again, however, gold has failed so far to sell-off in line with crude oil's retreat.

Indeed, gold rarely fulfils its famous role as a "safe haven", despite what TV pundits and newspaper commentators may claim. (To get the facts now, click here and read on...)

In the currency markets the Japanese Yen today continued to drag near a one-month low of ¥118.75 to the Dollar.

Since rallying hard as global equity markets sank at the start of March, the Yen has now lost ground against all 16 of the world's most actively traded currencies reports Bloomberg.

"It's game back on for the carry trade," says Jonathan Cavenagh, a currency strategist at Westpac in Sydney.

"I expect to see further weakness in the Yen."

And as the Yen fell, gold futures traded at the Tocom for delivery in Feb. '08 rose 0.6% to the equivalent of $672 per ounce.

The Nikkei stock index jumped 1.75% to a 5-week closing high, and the Dax in Frankfurt today opened near 6-year highs as European equities were pushed higher by fresh M&A rumors.

Mergers & acquisitions have helped reward gold mining stock investors over the last two years, too.

Further consolidation in 2007 looks certain – but more money spent digging for gold on the stock market is likely to reduce the amount spent exploring for new reserves in the ground.

To continue reading about why more money equals less gold, click here now...