* Gold down as Greek economic worries boost dollar vs euro
* Investors eye potential CFTC moves on gold, silver
* US platinum, palladium ETFs holdings at near 200,000 oz
(Recasts, updates comments, closing prices, market
activity, adds NEW YORK to dateline)
By Frank Tang and Rebekah Curtis
NEW YORK/LONDON, Jan 15 (Reuters) - Gold fell to around
$1,130 per ounce on Friday as a dollar rise dampened investor
sentiment, but palladium hit a 18-month high on strong
investment demand related to the U.S. exchange traded funds.
Gold ended the week lower as news of China's tightening
bank-lending requirement earlier this week curbed economic
optimism, decreasing gold's inflation hedge appeal. Bullion
rose 4 percent in the first week of the year.
Currency markets were not in gold's favor as the euro fell
nearly 1 percent against the dollar <EUR=>, with struggles in
the Greek and other European economies fueling 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=> was at $1,128.20 per ounce at 1:34 p.m.
EST (1834 GMT), compared with $1,142.15 quoted late in New York
on Thursday.
U.S. February gold futures <GCG0> settled down $12.50, or
1.1 percent, at $1,130.50 an ounce on the COMEX division of
NYMEX.
The dollar rose sharply, helped by data showing a rise in
manufacturing and stable consumer price inflation, suggesting
price increases are not enough to trouble the Federal Reserve.
"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. []
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."
The U.S. platinum and palladium ETFs were met with strong
buying interest, with nearly 200,000 ounces of metals added by
its first full trading week. []
Palladium <XPD=> traded at $449.50 versus $441.50. The
metal earlier hit $451 per ounce, its highest since mid-July
2008.
Spot platinum <XPT=> was at $1,594 after rising as high as
$1,618.50, and compared with $1,607 in New York.
Silver <XAG=> traded at $18.38 from $18.64.
(Additional reporting by Humeyra Pamuk in London; Editing
by Lisa Shumaker)
(Reporting by Frank Tang)
