Gold turned higher on Monday as France and Germany told Greece the door was open to negotiations after Greek voters had rejected the terms of a bailout package.

Spot goldwas up 0.2 percent at $1,169.25 an ounce by 3:08 p.m. EDT (1908 GMT), while U.S. gold futures settled up $9.70, or 0.8 percent, at $1,173.20 an ounce.

Leaders of France and Germany told Greece’s government the door for negotiations with creditors remained open but urged it to make credible proposals at a euro zone summit to reach a cash-for-reform deal and so avoid a euro zone exit.

Gold prices turned higher on expectations of a statement after French President Francois Hollande and German Chancellor Angel Merkel met to discuss Greece, said Tai Wong, director of base and precious metals trading for BMO Capital Markets in New York.

The Greek vote leaves the country in uncharted waters, risking a banking collapse. Without more emergency funding from the European Central Bank, Greece’s banks could run out of cash within days. European leaders called a summit for Tuesday to discuss their next move.

Source : Reuters