Gold like other risky assets fell reacting on the news.
Investors' sentiments for the gold have been changed from past two months. Until last year investors used to park their surplus in gold during the times of financial turmoil over the euro zone.
Gold seems to be losing its safe haven tag; as nowadays, any bad news from Europe is turning investors sour about the yellow metal in line with other riskier assets.
Overseas spot gold dropped aggressively from $1,745 to $1,720 a troy ounce. On Friday, it slipped further and was seen trading low at US$ 1,710 - $1,711 per ounce for Dollar.
Surprisingly, India gold futures rested steady on the major commodity bourses. Gold for February delivery contract on the MCX opened at Rs 29,072 per 10 grams and was trading in the range of 29,128 – Rs 29,129 per 10 grams at 11:50 am IST.
Investors have crossed their fingers ahead of EU summit, where European Union political leaders are going to discuss about the resolution of the nation's debt crisis.
The outcome of the meeting may decide the movement of the yellow metal and other assets.