* Gold ends week $30 weaker on money tightening concerns
* Commods weakness led by oil, economic uncertainty weigh
* S.Africa slips to fourth place as world gold producer
* Coming up: FOMC Meeting result on Tuesday
(Recasts, updates comments, closing prices; changes byline,
dateline; previously LONDON)
By Frank Tang
NEW YORK, March 12 (Reuters) - Gold briefly dropped below
$1,100 an ounce on Friday despite a dollar rise, ending the
week $30 weaker as investors unwound positions added last week
due to currency volatility amid a Greek debt crisis.
Speculations of further money tightening by China and
economic uncertainty amid sovereign debt worries out of Europe
prompted heavy future liquidation this week.
Gold's losses this week in the wake of a lower dollar
indicate the inverse relationship between the metal and the
U.S. currency is broken for now, but traders said that could
reverse soon.
"The focus right now is mainly on the stock market, and it
is a rarity that gold is down with a falling dollar. At some
point, I foresee this relationship will go back to normal,"
said Jeff Pritchard, analyst at California-based broker-dealer
Altavest.
Spot gold <XAU=> was at $1,101.80 an ounce at 3:16 p.m. EST
(2016 GMT), against $1,109.30 late in New York on Thursday.
U.S. April gold futures <GCJ0> on the COMEX division of the
NYMEX settled down $6.50 at $1,101.70 an ounce.
Gold prices rose earlier in the session as the euro's
recovery versus the dollar fueled buying. However, a brief
retreat in the single currency dragged the metal through major
technical support at $1,115 an ounce, analysts said. []
After rising almost $20 last week, gold was pressured as
traders take profits. Speculators had been increasing their net
long position in gold for four straight weeks but they may now
be trimming those positions, putting selling pressure on the
yellow metal, traders said.
The latest Commitment of Traders report by the U.S.
Commodity Futures Trading Commission showed net long
noncommercial gold futures positions at 207,372 contracts, up
3.4 percent from the prior week and up 14 percent during the
last four weeks.
OIL, COMMODS DECLINES PRESSURE GOLD
Oil fell below $82 a barrel as weak U.S. consumer sentiment
weighed on the market and offset an earlier report of stronger
February U.S. retail sales. []
Weak physical demand also weighed on sentiment. Russia's
central bank said it sold gold coins containing 2,300 ounces of
the metal in January, an 85 percent slump compared with 15,700
ounces a year earlier. []
In supply news, South Africa's Chamber of Mines said the
republic's gold production fell by 5.8 percent in 2009, pushing
it to the fourth-biggest producer after China, Australia and
the United States. []
Among other precious metals, silver <XAG=> was at $17.02 an
ounce against $17.16 on weak investment demand. The world's
largest silver ETF, the iShares Silver Trust <SLV>, said its
holdings fell 48.8 tonnes from a day earlier to 9,302.58 tonnes
on Thursday. []
Elsewhere platinum <XPT=> initially hit a seven-week high
$1,623.50 an ounce. It fell on broad-based commodities decline
and was last at $1,605 against $1,609.50, while palladium
<XPD=> was at $461 against $458.
The metals have by far outperformed gold this year as
investors expect industrial demand from carmakers to improve
and investment buying to rise. They are also closely eyeing the
supply of metals.
Close Change Pct 2009 YTD
Chg Close % Chg
US gold <GCJ0> 1101.70 -6.5 -0.6 1096.20 0.5
US silver <SIK0> 17.048 -0.112 -0.7 16.845 1.2
US platinum <PLJ0> 1608.40 -4.30 -0.3 1471.00 9.3
US palladium <PAM0> 463.15 2.15 0.5 408.85 13.3
Prices at 3:30 p.m. EST (2030 GMT)
Gold <XAU=> 1101.85 -7.45 -0.7 1096.35 0.5
Silver <XAG=> 17.02 -0.14 -0.8 16.84 1.1
Platinum <XPT=> 1605.00 -4.50 -0.3 1465.50 9.5
Palladium <XPD=> 460.50 2.500 0.5 405.50 13.6
Gold Fix <XAUFIX=> 1106.25 -12.50 -1.1 1104 0.2
Silver Fix <XAGFIX=> 17.31 40.00 2.4 16.99 1.9
Platinum Fix <XPTFIX=> 1619.00 0.00 0.0 1466 10.4
Palladium Fix<XPDFIX=> 464.00 2.00 0.4 402 15.4
(Additional reporting by Jan Harvey in London; editing by
Julie Ingwersen)
