* Bullion turns lower despite initial one-month high
* Fears over U.S. tightening, Greece weigh on gold
* Investors await Bernanke's testimony, US GDP data
(Recasts, updates comments, closing prices, market
activity, adds second byline)
By Frank Tang and Maytaal Angel
NEW YORK/LONDON, Feb 22 (Reuters) - Gold turned lower on
Monday, retreating from a one-month high earlier in the
session, as uncertainty about monetary tightening and currency
volatilities took a toll on investor sentiment.
Signs that the U.S. Federal Reserve could unwind more
economic stimulus programs also dampened bullion's inflation
hedge appeal.
Renewed worries about Greece's ability to repay its debt
also increased choppiness in the euro. []
Bruce Dunn, vice president of trading at New Jersey-based
Auramet, said gold was pressured by the Fed's surprise hike in
discount rates -- emergency borrowing rates for banks -- and
Greece news.
"There is so much uncertainty that people don't know what
to expect," he said.
Spot gold <XAU=> was at $1,115.20 an ounce by 3:08 p.m. EST
(2008 GMT), down from $1,117.50 at New York's late quote on
Friday. Earlier in the session, it hit a one-month high of
$1,130.65.
Bullion was about 8 percent below an all-time high above
$1,200 an ounce struck in early December and but still well
above a three-month low around $1,043 hit almost three weeks
ago.
U.S. April futures <GCJ9> settled down $9 at $1,113.10 an
ounce on the COMEX division of NYMEX.
The dollar held gains against the euro due to reports that
Germany has made no decision on aid for Greece. []
[]
A stronger dollar weighs on gold as it dents the metals
appeal as an alternative to the U.S. currency. It also makes
dollar-priced gold costlier for non-U.S. investors.
Gold priced in euros <XAUEUR=R> traded at about 819, off
last week's record of around 830 euros.
Gold, sometimes bought as a safe haven asset and hedge
against financial uncertainty, has been moving in line with
risk appetite and assets perceived as riskier, such as
equities.
Currency markets took the Fed's surprise decision to raise
its discount rate last week as a signal the U.S. central bank
was coming closer to raising its benchmark rate.
Profit-taking increased after a weekly trade report by the
U.S. Commodity Futures Trading Commission showed that the net
long positions by noncommercial users, or speculators,
increased 4 percent. []
"A lot of financial market participants are long, so
there's still profit to be taken," said Tobias Merath, analyst
at Credit Suisse.
IMF GOLD SALE, DATA EYED
Last week's news that the International Monetary Fund would
shortly begin selling 191.3 tonnes of gold in the open market
under a previously approved program also dent sentiment.
Investors await Fed Chairman Ben Bernanke's twice-yearly
testimony to U.S. Congress and the U.S. gross domestic product
data later this week for further clues on rate policy, and also
further clues on the U.S. economy. []
In other precious metals, silver <XAG=> was at $16.22 an
ounce versus $16.27, platinum <XPT=> was at $1,525 versus
$1,530 and palladium <XPD=> was at $439, up from its previous
finish at $437.00.
Close Change Pct 2009 YTD
Chg Close % Chg
US gold <GCJ0> 1113.10 -9 -0.8 1096.20 1.5
US silver <SIH0> 16.222 -0.191 -1.2 16.845 -3.7
US platinum <PLJ0> 1531.90 -11.70 -0.8 1471.00 4.1
US palladium <PAH0> 442.10 -0.25 -0.1 408.85 8.1
Prices at 3:32 p.m. EST (2032 GMT)
Gold <XAU=> 1114.60 -2.90 -0.3 1096.35 1.7
Silver <XAG=> 16.21 -0.06 -0.4 16.84 -3.7
Platinum <XPT=> 1522.00 -8.00 -0.5 1465.50 3.9
Palladium <XPD=> 439.00 2.000 0.5 405.50 8.3
Gold Fix <XAUFIX=> 1115.25 -4.50 -0.4 1104 1.0
Silver Fix <XAGFIX=> 16.44 49.00 3.1 16.99 -3.2
Platinum Fix <XPTFIX=> 1535.00 2.00 0.1 1466 4.7
Palladium Fix<XPDFIX=> 441.00 1.00 0.2 402 9.7
(Reporting by Frank Tang and Maytaal Angel; Editing by
Marguerita Choy)
