* Euro climbs versus dollar, recovering from 7-wk low
* Concerns over Ireland recede as EU-IMF rescue package eyed
* U.S. palladium ETP holdings hold at record high
(Updates prices)
By Jan Harvey and Amanda Cooper
LONDON, Nov 18 (Reuters) - Gold rose more than 1 percent on
Thursday, breaking its longest stretch of losses in almost six
months, as anticipation of an emergency loan for Ireland boosted
the euro and lured investors back into commodities.
Spot gold <XAU=> was bid at $1,356.20 an ounce at 1510 GMT,
against $1,335.70 late in New York on Wednesday, but down from
an intraday high of $1,358.65 after strong regional U.S.
manufacturing data helped the dollar pare losses.
[]
U.S. gold futures for December delivery <GCZ0> rose $12.70
to $1,349.5.
"Precious metals are rebounding today along with other
commodities, mainly as the dollar weakens relative to a number
of currencies," said Anne-Laure Tremblay, BNP Paribas precious
metals strategist.
Gold's inverse relation to the U.S. dollar has strengthened
in the last week, meaning it has gained traction from the
recovery in the euro from its recent seven-week lows.
"It's not just a currency thing. It's got to do with the
belief that governments aren't in control of the economic and
financial situation. That's been supportive for gold
investment," said Matthew Turner, an analyst with Mitsubishi.
Raw materials such as gold, platinum, copper and crude oil
had all seen heavy losses this week on talk of a possible
Chinese interest rate hike, and as concerns over debt levels in
the euro zone pressured the single currency against the dollar.
But commodities bounced back on Thursday as the euro rose
one percent against the dollar amid optimism that aid would soon
be granted to debt-laden Ireland. []
Ireland's central bank chief said on Thursday he expected
the country to receive tens of billions of euros in loans from
European partners and the IMF to help shore up its shattered
banks and stabilise the economy. []
Gold has risen by over 20 percent this year to a record
$1,424.10 an ounce, lifted by concern over sovereign debt and
the stability of the currency markets, before being hit heavily
this week by weakness in other commodities.
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For a graphic showing the relative price performance of
major commodities this year, click: http://r.reuters.com/baf29p
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CURRENCIES STILL VOLATILE
"At one point, everyone was selling commodities," said Simon
Weeks, head of precious metals at the Bank of Nova Scotia.
"People had been good buyers, everyone had put risk back on the
books, and suddenly they got panicky about China and started
liquidating, and gold got caught up in that.
"But I do think it will reassert itself on the crosses at
some point as a currency, because clearly people don't like the
currency markets. Generally speaking, whichever currency you are
looking at people aren't really that comfortable," he said.
Among other precious metals, silver <XAG=> rose to $26.44 an
ounce against $25.61, though it remains well below the 30-year
high of $29.33 an ounce it hit earlier in November.
Platinum <XPT=> was at $1,647.24 an ounce against $1,633.49,
while palladium <XPD=> was at $680.22 against $660.25.
Palladium holdings of ETFS Physical Palladium Shares, the
physically-backed exchange-traded product operated by a unit of
London's ETF Securities, held at a record high of 920,362 ounces
on Wednesday, the company's website showed. Holdings of ETFS
Physical Platinum Shares were at 343,132 ounces, their highest
since early May.
Industrial buying of palladium is expected to outstrip call
for platinum. "Palladium is seen stronger than platinum in terms
of auto demand," Fairfax analysts said in a note.
(Reporting by Jan Harvey; editing by Keiron Henderson)
