* Gold rallies to 1-month high
* Oil surges above $142 a barrel, lifetime record
* Dollar holds near 3-week low against euro
(Recasts, adds comment, updates prices)
By Raissa Kasolowsky
LONDON, June 27 (Reuters) - Gold rose to a one-month high on
Friday as record oil prices heightened global inflation concerns
and the dollar weakened against the euro.
Gold <XAU=> climbed to $925.50 an ounce, its highest since
May 27 and was at $924.50/925.50 an ounce by 1421 GMT, well
above the $912.60/913.60 an ounce it was quoted late in New York
on Thursday.
"It's holding quite well near the highs, closely following
crude oil and euro-dollar," said UBS analyst John Reade.
"It certainly seems that with the oil prices very strong,
the dollar fairly weak and obviously lots of risk aversion
around that, gold can do quite well."
In theory, rising energy prices boost gold's appeal as a
hedge against inflation, while a weaker dollar makes the metal
an attractive alternative investment.
Despite the gains, gold was still well below a lifetime high
of $1,030.80 an ounce hit in March.
Reade said the charts indicated that gold could rise further
in the short-term.
"If we hold and close at these levels this will prompt some
more buying next week. The reason for that is that we're quite
comfortably above the 100-day moving average (of prices) now,
which comes in at about $916," he said.
Oil <CLc1> leapt to a new record above $142 a barrel on
Friday, extending gains after surging nearly 4 percent in the
previous session. []
The dollar traded close to multi-week lows versus the euro
and the yen as investors reduced risk exposure amid record high
oil prices and fears about U.S growth.
The U.S. currency came under pressure after the U.S. Federal
Reserve's statement, earlier this week, scaled down expectations
of further interest rate hikes.
"After the Fed came in and talked about its inflation
concerns the market now sees the possibility of rate rises as
relatively low and that is really starting to pull on the gold
price which is particularly sensitive to FX and global rates,"
said Daniel Hynes, metals strategist at Merril Lynch.
In industry news, the market also kept an eye on the supply
side threats. In Peru, miners are going ahead with a plan to
strike for better benefits starting on Monday. []
Spot platinum <XPT=> slipped to $2,043.00/2,063.00 an ounce
from $2,057.50/2,077.50 late in New York. Spot palladium <XPD=>
held steady at $464.00/472.00 an ounce from $464.00/472.00 an
ounce.
Silver <XAG=> edged up to $17.41/17.46 an ounce from
$17.22/17.28 late in New York.
(Reporting by Raissa Kasolowsky; editing by David Evans)
