LONDON (Reuters) - Gold climbed above $1,100 an ounce in Europe on Monday as the dollar eased versus the euro, denting the metal's appeal as an alternative asset, with renewed physical and safe-haven buying also helping support prices. Gold was bid at $1,103 an ounce by 11:00 GMT, against $1,091.65 an ounce on Friday. US gold futures for February delivery were at $1,103.7 per ounce, up 1.3 per cent. "They are recovering a bit," said Eugen Weinberg, an analyst at Commerzbank. "The slump of the last week might be considered by some bargain hunters as being an excessive one. "Some see in gold protection going forward, if the correction on equity markets continues ... but also there is some physical buying at the current levels after the strong decreases." India, historically the world's top gold consumer, continued buying, with limited quantities changing hands below the $1,100 an ounce level, dealers said. Also supporting bullion, the dollar slipped against the euro and higher-yielding currencies, as some investors took profits on the US currency's broad gains last week. Reports that embattled Federal Reserve Chairman Ben Bernanke was edging closer to winning confirmation to serve a second term also calmed markets, tarnishing the dollar's safe-haven appeal, after his prospects were seen to be shaky last week. On Friday, gold hit a near five week low at $1,081.90, as commodities dipped on President Barack Obama's proposal to limit financial risk-taking. Obama's plans to restrict banks or financial institutions from associating with a hedge fund or a private equity fund, which was unveiled on Thursday, caused stocks and commodities to tumble. "The noose certainly seems to be tightening around the gold bulls with President Barack Obama's proposal to limit financial risk-taking, especially by the banking sector and also the due to the growing expectations that China will continue to tighten its monetary stance," said Pradeep Unni, senior analyst and trader at Richcomm Global Services. "The markets will continue to be volatile as the month ends, but the technical damage done in Friday's session hints that we have further downside targets in gold at the moment," he added. There are signs that China, the world's largest gold producer, could move to tighten monetary policy to rein in its booming economy.
