Gold inched up on Tuesday as the dollar's weakness, concerns about the sustainability of global economic recovery and worries of future inflation underpinned sentiment, with traders eyeing $1,000 an ounce.

FUNDAMENTALS

* Spot gold edged up 0.1 percent to $995.70 per ounce, compared to New York's notional close of $993.85. It was quoted at $993.40 late in New York on Friday. The price rose as high as $997.20 last week -- its highest since February, when it briefly topped $1,000. U.S. markets were closed on Monday for Labor Day holiday.

* U.S. gold futures for December delivery were at $997.90 per ounce, after settling at $996.70 on Friday. The contract rose to $999.50 on Thursday, the highest price since February.

* The world's largest gold-backed exchange-traded fund, the SPDR Gold Trust, said holdings stood at 1,077.63 tonnes as of September 7, unchanged from Friday.

MARKET NEWS

* Japan's Nikkei stock average <.N225> is likely to edge higher on Tuesday, bolstered by gains in European stocks, with a slight weakening of the yen boosting Canon Inc <7511.T> and other exporters. <.T>

* The dollar was steady after falling the previous day as a weekend meeting of global finance chiefs boosted investor appetite for growth-related riskier assets like commodities and stocks.

(Reporting by Chikako Mogi; Editing by Rodney Joyce)

Investment Gold