* Concerns over Greek economy knock euro
* Gold and silver ETFs dip, palladium flies
* Investors eye potential CFTC moves
(Updates prices, adds analyst's quote)
By Rebekah Curtis
LONDON, Jan 15 (Reuters) - Gold fell towards $1,130 per
ounce on Friday as a rising dollar made the metal costlier for
non-U.S. investors, but palladium hit an 18-month high as
traders continued to see strong investment demand.
Currency markets were not moving in gold's favour as the
euro fell versus the dollar <EUR=>, with struggles in the Greek
economy fuelling concerns about weakness in the euro zone.
[]
"We really need some dollar weakness to push gold higher,"
said Walter de Wet, an analyst at Standard Bank. "As long as the
Greece problems remain headline news we're not going to see that
weakness just yet."
Spot gold <XAU=> stood at $1,133.70 per ounce at 1338 GMT,
compared with $1,142.15 quoted late in New York on Thursday.
U.S. gold futures for February delivery <GCG0> were at
$1,132.60 an ounce, versus Thursday's close of $1,143.00 on the
COMEX division of the New York Mercantile Exchange.
On the regulation front, gold market participants were
fairly sanguine about the U.S. Commodity Futures Trading
Commission proposal of new measures to rein in speculation in
energy and commodity trading, especially oil.
Some analysts see gold and silver as harder targets for the
commission. To see an analysis on this, click on:
[]
Excessive speculation has been blamed for sending food and
oil prices to record highs in 2008. For stories on potential
CFTC moves, click on: []
Separately, the London Metal Exchange said it will offer
clearing for gold over-the-counter (OTC) contracts in London by
the second half of 2010. []
Gold, seen as a hedge against inflation, was little affected
by data showing U.S. consumer prices rose more slowly than
expected in December from November. The data pointed to subdued
inflation pressures. []
PALLADIUM BUCKS TREND
Palladium and platinum were supported by strong investment
demand from the launch of a new exchange-traded fund (ETF)
backed by the metals in New York. A U.S. subsidiary of London's
ETF Securities launched the products last Friday.
By contrast, the world's largest gold-backed exchange-traded
fund, SPDR Gold Trust <GLD>, said its holdings stood at
1,113.750 tonnes as of Jan. 14, down 0.2 percent from the
session before. []
"Palladium's on fire mainly because of this U.S. ETF,"
Citi's Thurtell said. "It's raised fears there'll be a bit of a
shortage of metal this year, if investors are absorbing a lot of
supply."
Palladium <XPT=> traded at $446.00 versus $441.50. The metal
earlier hit $451 per ounce, its highest since mid-July 2008.
Spot platinum <XPT=> stood at $1,598.00 after rising as high
as $1,618.50, and compared with $1,607.00 in New York.
"Apparently, a re-allocation in favour of the newly issued
palladium and platinum ETFs is taking place at present. In
contrast to gold, demand for these two ETFs remains sustainably
high and supports prices," Commerzbank said in a note to
clients.
Silver <XAG=> traded at $18.49 from $18.64.
The world's largest silver-backed exchange-traded fund, the
iShares Silver Trust <SLV>, said its silver holdings stood at
9,339.19 tonnes as of Jan. 14, down 1.6 percent from the
previous business day. []
(Reporting by Rebekah Curtis; Editing by Veronica Brown and
Sue Thomas)
