* Gold firm on lingering euro zone debt woes, soft U.S. data * SPDR gold ETF holdings rise to record 1,307.963 T * Gold:silver ratio at lowest since May on day-to-day basis
(Updates, adds comment, changes dateline from SINGAPORE)
By Jan Harvey
LONDON, June 18 (Reuters) - Gold held within reach of record highs in Europe on Friday, supported by haven demand against a backdrop of persistent sovereign risk in Europe and after lacklustre U.S. data raised doubts over wider economic recovery.
The precious metal's gains were limited, however, as immediate concern over the euro's outlook were allayed by solid demand at Spanish bond auctions, which calmed peripheral euro zone debt markets.
Spot gold <XAU=> was bid at $1,243.95 an ounce at 0813 GMT, against $1,243.40 late in New York on Thursday. U.S. gold futures for August delivery <GCQ0> eased $3.20 to $1,245.50.
Prices reached $1,250.65 on Thursday, close to the record $1,251.20 it hit last week. Its move came despite a rise in the euro, weakness in which has lifted gold this year as investors bought the metal as an alternative to paper currencies.
"The main driver behind gold is not the currencies, it is the underlying fundamental problems, especially here in Europe," said Commerzbank analyst Daniel Briesemann.
"Gold should rise further. It increased significantly yesterday. On a closing basis, gold in U.S. dollars reached a record high and intraday we were only $1 below the record high."
He said the prospect of publication of European bank stress tests was unsettling some market participants, amid fears these could point to deeper problems in the European financial sector.
European leaders agreed on Thursday to publish details of stress tests showing the financial health of individual banks next month and to toughen budget rules to restore confidence in their currency union. [
]The euro held at three-week highs, on track for its second straight week of gains, while the dollar appeared vulnerable to further losses after falling below a key chart level. [
]European shares also firmed, rising for the eighth straight session after Wall Street shares eked out modest gains. [
]U.S. stocks staged a late recovery on Thursday after earlier declining as weak reports on regional manufacturing and jobless claims underscored worries about the pace of the economic recovery. [
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SPDR ETF HITS RECORD
Holdings of the world's largest gold-backed exchange-traded fund, New York's SPDR Gold Trust <GLD>, hit record highs at 1,307.963 tonnes on Thursday as investors continued to turn to physical bullion as a haven from risk. <^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^
For a graphic showing the volume flow in holdings of the SPDR fund, click on: http://graphics.thomsonreuters.com/10/GLD_SPDRVL0610.gif. For a graphic showing the rise in total holdings, click on: http://graphics.thomsonreuters.com/10/GLD_SPDR0610.gif ^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^>
Among other precious metals, silver <XAG=> rose to $18.74 an ounce against $18.67, slightly outperforming the rise in gold prices, after the metal hit a four-week high of $18.86 an ounce on Thursday.
The gold:silver ratio fell to its lowest since late May on a day-to-day basis, with one ounce of gold now buying 66.4 ounces of silver. Silver, a smaller and more illiquid market than gold, tends to outperform the yellow metal when prices are rising.
"If both gold and silver continue to improve, we expect silver to outperform, thus moving the gold-silver ratio lower," said ScotiaMocatta in a note.
Among other precious metals, platinum <XPT=> was at $1,571.50 an ounce against $1,574, while palladium <XPD=> was at $476.50 against $479.50.
The world's biggest palladium producer, Norilsk Nickel <GMKN.MM>, said it had received an offer for some of its Australian assets, and that it planned to proceed with plans to divest them. [
] (Editing by James Jukwey)