Gold prices hit their highest for a week in Monday morning bullion trading in Europe, with the precious metals sector in a positive frame of mind ahead of this week's US FOMC meeting, traders said. Spot gold was indicated at $1,710.60/1,711.40, up $6.70 from the previous close, having hit a high of $1,711.90. On Friday, bullion hit a low of $1,683.90, its cheapest since November 6. Silver and platinum were also around one-week highs, while palladium clawed up to a three-month peak. Although investor attention will be directed towards US fiscal cliff developments and Italian political uncertainty, the week's keynote event will be the US Federal Reserve's FOMC meeting and policy announcement on Wednesday for an update on the economy from chairman Ben Bernanke. "After the ECB’s fairly dovish tone, similar comments by the Fed could help precious metals in particular," broker Credit Suisse said. Broker Mitsubishi said that policy action by the Fed would be scrutinised. The extension of 'Operation Twist’ - selling short-dated bonds - is seen less likely as opposed to further quantitative easing (QE). "QE is considered more effective than 'Operation Twist' as it expands the Fed’s balance sheet. It is also the policy that should have the biggest positive impact on the gold and silver price," Mitsubishi said. Today's upbeat tone was helped by a modest dip in the dollar to some 1.2905 against the euro, although the US currency's inverse relationship with gold has tended to be less definite recently. There are no important US data releases today, with figures from elsewhere already released. Over the weekend, figures showed that Chinese exports in November increased by 2.9 percent to $179.4 billion, albeit hopes were for 9.6 percent growth in shipments. Imports were unchanged from the previous month at $159.8 billion. On Monday, October French and Italian industrial production both fell, the October German trade surplus was just under expectations, while the balance and the December eurozone Sentix Investor Confidence index was a slightly worse -16.8. In Italy, Prime Minister Mario Monti’s pledge to tender his resignation once the Italian government has approved the 2013 budget has unsettled markets and pushed up the country’s borrowing rates. In other precious metals, silver touched $33.39 and was then quoted at $33.31/33.36, up 27 cents. Palladium hit $701.50 and then settled at an unchanged $698/703. Platinum rose to $1,619.50, before holding at $1,612/1,622, a $3 gain.