Gold holds above $1,580/oz on EU summit uncertainty

A fifth euro-zone country turned to Brussels for emergency funding on Monday when Cyprus announced it was seeking a lifeline for its banks and its budget, hours after Spain submitted a formal request to bail out its banks.

Fundamentals

* Spot gold hardly changed at USD 1,584.49 an ounce at 0022 GMT. Gold hit a lifetime high of about USD 1,920 in 2011, when investors turned to the metal as a safe haven during the debt crisis in Europe.

* US gold for August delivery slipped USD 2.90 an ounce to USD 1,585.50.

* Struggling debtor Spain is likely to pay its highest short-term borrowing rates in over six months on Tuesday as investors demand high premiums, sceptical about euro zone leaders' readiness to act decisively to tackle the bloc's problems.

Market News

* Japan's Nikkei share average fell to a one-week low in early deals on Tuesday on scepticism that this week's European summit will produce any significant progress to tackle the currency bloc's debt crisis.

* US oil held steady above USD 79 on Tuesday as forecasts of a drop in crude stockpiles supported prices amid low expectations that a European summit this week could resolve the region's debt crisis and boost global fuel demand.

* The euro slipped to an almost two-week low against the US dollar on Monday and more losses were expected as investors bet a European summit will fail to find a solution to the region's debt crisis.