* Investors watch Saudi Arabia
* Gold market remains tight, scrap sales seen
* U.S. Feb retail sales rise 1 percent
(Adds comment/detail, updates prices)
By Pratima Desai and Rebekah Curtis
LONDON, March 11 (Reuters) - Gold steadied on Friday, losing
recent momentum as losses in oil reduced the metal's appeal as a
safe haven from inflationary pressures, but a major earthquake
in Japan and unrest in the Middle East kept prices underpinned.
On track for its biggest weekly decline since early
January, the precious metal was down about $30 from a lifetime
high of $1,444.40 a troy ounce on Monday.
Spot gold <XAU=> was bid at $1,413.20 an ounce at 1351 GMT,
up a fraction from $1,412.59 late in New York on Thursday.
Investors protect their portfolios by buying gold when they
expect rising price pressures, often fuelled by energy costs,
but U.S. crude futures <CLc1> fell below $100 a barrel. []
Analysts remained bullish on bullion, however.
"Gold is holding up pretty well through this general
sell-off through the commodities complex," Daniel Smith, an
analyst at Standard Chartered, said.
"The usual drivers for gold are still in place...," he said,
citing strong imports from China and rising inflation. "We
remain bullish on gold from a medium-term perspective."
The biggest earthquake to hit Japan since records began 140
years ago struck the northeast coast, triggering a 10-metre
tsunami that swept away everything in its path, including
houses, ships, cars and farm buildings. []
"Gold is trading off oil, but Japan's earthquake and tension
in the Middle East is helping," said Andrey Kryuchenkov, an
analyst at VTB Capital. "Markets are nervous also with a planned
'day of rage' in Saudi Arabia."
Investors are watching to see what happens in Saudi Arabia,
where a planned day of demonstrations will test whether
activists calling for political reform will succeed in taking
their protests to the streets. [] []
Also on the radar was Libya, where a sea and tank assault
was launched on the oil port of Ras Lanuf overnight,
intensifying a counter-offensive against insurgents.
[]
"Historically, those sort of events in the Middle East have
tended to be quite supportive," said Michael Lewis, head of
commodity research at Deutsche Bank.
"But the effect will probably fade quite quickly."
Gold prices were little affected by data showing U.S. retail
sales rose an expected 1 percent in February. []
TAINTED
Silver <XAG=> was bid at $34.54 an ounce from $35.25 on
Thursday, having rallied to a 31-year peak above $36 on Monday.
Holdings of iShares Silver Trust <SLV> were unchanged at a
record high at 10,974.06 tonnes.
"While clients we visited in the U.S. and Canada over the
past two weeks mostly wanted to talk about gold, we noted a
clear upward shift in their interest in silver," UBS said in a
note.
"There is little doubt that gold has lost some of its
previous supporters to silver. Of those clients able to invest
in the metal itself, rather than being restricted to silver
equities, close to half were extremely bullish on silver's
prospects."
Spot platinum <XPT=> was at $1,770.50 an ounce from
$1,760.24 on Thursday and palladium <XPD=> at $749.72 an ounce
from $765.50 an ounce.
"The appeal of (platinum and palladium) has been tainted by
people worrying about the rise in oil prices and the impact on
economic growth," a trader said.
(Editing by Jane Baird and Jason Neely)
