* Gold comes under pressure as dollar swings higher
* GFMS says platinum will stay in surplus in 2010
* Coming up: US durable goods, new home sales on Friday
(Recasts, adds comments, closing prices, adds NEW YORK to
dateline, changes byline)
By Frank Tang and Jan Harvey
NEW YORK/LONDON, April 22 (Reuters) - Gold fell on Thursday
as the euro plunged to a near 1-year low following a downgrade
of Greece's debt, while a closely watched report showed market
balances of platinum and palladium should tighten this year.
The gold market continues to take trading cues from the
currency markets, largely driven by Greece and other possible
sovereign debt downgrades, traders said.
Credit rating agency Moody's downgraded Greece's credit
rating on Thursday, and said it placed Athens on review for a
further possible downgrade. In addition, data showed Athens'
budget gap last year was worse than expected. []
"We have asset sales across the world right now as Greece's
banks got hammered. Gold has held up really well over the
course of when the dollar has been going higher," said COMEX
floor gold trader Jonathan Jossen.
The inverse link between gold and the dollar has recently
weakened as funds piled into gold in a flight to quality, but
the metal will come under pressure if the dollar keeps rising
against the euro on Greece's woes, analysts said.
Spot gold <XAU=> was at $1,141.95 an ounce at 1:59 p.m. EDT
(1759 GMT), against $1,145.30 late in New York on Wednesday.
U.S. June gold futures <GCM0> on the COMEX division of the
NYMEX settled down $5.90 at $1,142.90 an ounce.
Bullion was off its lows after falling toward $1,130
earlier in the session when the euro partially recovered
against the dollar.
"Gold has been beaten back a bit, but it is not doing too
badly," said Marc Elliott, an analyst at Fairfax investment
bank. "The dollar is attractive as a safety currency, but gold
has that attraction too."
The dollar rose to near a one-year high against the euro
after Moody's cut Greece's rating. []
"You have the short-term, knee-jerk reaction, which is that
the flight to the dollar knocks gold, but that settles down as
people want a longer-term hedge," Elliott said.
Platinum group metals rose to multi-year highs early in the
session on optimism about demand from a global auto recovery,
but were later pulled off their highs when the dollar
strengthened.
Platinum <XPT=> was slightly higher at $1,734.50 an ounce
against $1,731 in the previous session. Earlier, it reached its
highest level since mid-2008 at $1,751.50 an ounce.
Meanwhile, palladium <XPD=> slipped to $559.50 an ounce
from $563 on Wednesday, after rising to a two-year peak of $569
early on Thursday.
Palladium and platinum have risen by about 38 and 19
percent respectively so far this year, compared with gold's 4
percent gains.
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For a graphic showing the ratio of platinum to gold prices,
click on:
http://graphics.thomsonreuters.com/gfx/SBrb_20102204103742.jpg
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GFMS: PLATINUM SEEN IN SURPLUS
In its 2010 Platinum & Palladium report metals consultant
GFMS said, the platinum market is set to remain in surplus
again this year, although to a lesser extent than in 2009.
Market balances of both platinum and palladium are expected
to tighten a little this year as the automotive industry
recovers after last year's slump. But an expected drop in
jewelry buying may curb platinum demand. []
In an interview with Reuters, GFMS consultant Peter Ryan
said platinum's sister metal palladium was fundamentally in the
stronger position and could hit highs last seen in 2001.[]
A rise in car production was leading to more industrial
off-take of the metals, especially in China, but analysts said
investors were also buying platinum group metals in
anticipation of further demand increases later in the year.
Silver <XAG=> was last at $17.96 an ounce against $18.03.
Close Change Pct 2009 YTD
Chg Close % Chg
US gold <GCM0> 1142.90 -5.9 -0.5 1096.20 4.3
US silver <SIK0> 18.009 -0.069 -0.4 16.845 6.9
US platinum <PLN0> 1744.20 3.90 0.2 1471.00 18.6
US palladium <PAM0> 565.10 -3.15 -0.6 408.85 38.2
Prices at 1:59 p.m. EDT (1759 GMT)
Gold <XAU=> 1141.95 -3.35 -0.3 1096.35 4.2
Silver <XAG=> 17.98 -0.05 -0.3 16.84 6.8
Platinum <XPT=> 1737.00 6.00 0.3 1465.50 18.5
Palladium <XPD=> 559.50 -3.500 -0.6 405.50 38.0
Gold Fix <XAUFIX=> 1133.75 -10.50 -0.9 1104 2.7
Silver Fix <XAGFIX=> 17.98 16.00 0.9 16.99 5.8
Platinum Fix <XPTFIX=> 1731.00 15.00 0.9 1466 18.1
Palladium Fix<XPDFIX=> 558.00 8.00 1.4 402 38.8
(Reporting by Frank Tang and Jan Harvey; Editing by Carole
Vaporean)
