Gold near 1-week low as stocks rally, dollar firms

Gold was largely unchanged on Wednesday, struggling near a one-week low as stocks markets continued to rally on expectations of a Greek debt deal and a firmer dollar.

Spot gold was almost flat at $1,177.9 an ounce by 0104 GMT, after losing 0.6 percent on Tuesday.

The yellow metal which is often seen as an alternative investment during times of financial and economic uncertainties, has come under pressure after Greece's leftwing government expressed confidence that parliament would approve a debt deal with lenders.

The market fell for the last three sessions, leaving gold vulnerable to pressure from other factors, such as the prospect of the first U.S. interest rate rise from the Federal Reserve in nearly a decade. That would boost the opportunity cost of holding non-yielding bullion.

Fed Governor Jerome Powell said he was prepared to raise interest rates twice this year, once in September and once in December, as long as the economy performs as expected. Later in the day, the Atlanta Fed's GDPNow forecast model showed the U.S. economy is on track to grow 2 percent in the second quarter.

Strength in the dollar, which is benefiting from upbeat U.S. data, provided further headwinds for gold, which is priced in the U.S. unit and tends to gain when the currency is weak.