* Concerns over Greek economy knock euro
* Gold and silver ETFs dip, palladium flies
* Investors eye potential CFTC moves
(Updates prices, U.S. data)
By Rebekah Curtis
LONDON, Jan 15 (Reuters) - Gold fell to around $1,130 per
ounce on Friday as a rising dollar made the metal costlier for
non-U.S. investors, but palladium hit a fresh 18-month high as
traders continued to see strong investment demand.
Currency markets were not 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 $1,132.15 per ounce at 1604 GMT,
compared with $1,142.15 quoted late in New York on Thursday.
The dollar held onto its gains after news U.S. consumer
prices rose modestly last month, while a cold snap lifted
industrial output, suggesting the economy was growing but not
generating enough inflation to trouble the Federal Reserve.
[]
U.S. gold futures for February delivery <GCG0> were at
$1,132.30 an ounce, versus Thursday's close of $1,143.00 on the
COMEX division of the New York Mercantile Exchange.
"On one hand it is being supported by continued investment
interest," said Ole Hansen, senior manager at Saxo Bank. "The
economic problems facing countries around the Mediterranean and
Ireland are well known and a continuation of the dollar's month
long slide can no longer be taken for granted," he said.
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:
[]
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. []
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.
"Palladium's on fire mainly because of this U.S. ETF," David
Thurtell, analyst at Citi 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 $447.00 versus $441.50. The metal
earlier hit $451 per ounce, its highest since mid-July 2008.
Spot platinum <XPT=> stood at $1,604.00 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,
Silver <XAG=> traded at $18.46 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. []
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. []
(Additional reporting by Humeyra Pamuk, Editing by Keiron
Henderson)
