* Sovereign debt concerns boost safe-haven assets
* Risk aversion lifts dollar but gold resilient
* Coming up: U.S. industrial production, Empire State
* Coming up: U.S. Fed policy committee meeting on Tuesday
(Updates prices, adds graphic)
By Jan Harvey
LONDON, March 15 (Reuters) - Gold rose on Monday as concerns
over sovereign debt prompted buying of the metal as a haven from
risk after a Moody's report and ahead of a meeting of euro zone
finance ministers on financial help for Greece.
Assets seen as higher risk, such as equities, crude oil and
industrial commodities like copper, all retreated as risk
appetite receded. However, gold rose 0.7 percent.
Spot gold <XAU=> was bid at $1,107.85 an ounce at 1126 GMT,
against $1,099.50 late in New York on Friday. U.S. gold futures
for April delivery <GCJ0> on the COMEX division of the New York
Mercantile Exchange rose $6.50 to $1,108.20 an ounce.
Commerzbank analyst Eugen Weinberg said investors had been
cheered by the market's defence of the $1,100 an ounce level
last week, adding that a report from ratings agency Moody's that
highlighted burgeoning government debt was also helping prices.
"It is helping the market because if you are looking for
security you buy gold," he said.
"We are not seeing huge flows, but constant flows. As long
as interest rates stay at current levels, it also makes the
opportunity cost of buying gold relatively low."
An EU source said euro zone finance ministers are likely to
agree on Monday on the principles and parameters of financial
help for Greece, if it is required, but leave out any sums until
Athens asks for them. []
Concern over the fiscal health of peripheral euro zone
economies like Greece has supported gold in recent weeks.
Moody's Investors Service said the credit ratings of the
world's four largest triple-A sovereign debt issuers - the
United States, Britain, France and Germany - and Spain were
safe, but risks to their blue-chip status had grown.
[]
"Speculation both the UK and U.S. could lose their
AAA-credit ratings should act to underpin the metals,
potentially drawing investment demand away from US treasuries,"
said James Moore, an analyst at TheBullionDesk.com, in a note.
Chinese premier Wen Jiabao also spooked currency markets,
saying on Sunday the yuan was not undervalued, and rejecting
calls to allow the currency to rise. []
DOLLAR FIRMS
The dollar rose broadly on Monday as a drop in stock markets
prompted some investors to shy away from riskier assets. []
Gold's resilience in recent months in the face of a rising
dollar has underlined the metal's appeal as a haven from risk as
sovereign debt fears in the euro zone and further afield shift
to the fore, analysts said. []
For a graphic showing gold's declining correlation with the
euro-dollar this year, click on:
http://graphics.thomsonreuters.com/310/GLD_CRRD0310.gif
Traders are awaiting further direction from U.S. data due
later in the session, including industrial production numbers
for February, and a Federal Reserve policy setting committee
meeting on Tuesday. []
The metal ignored a report that the German finance ministry
was mulling the possibility of euro zone countries using central
bank gold reserves to back a European Monetary Fund, after the
Bundesbank said it was unaware of any such plan. []
Among other commodities, oil prices retreated, pressured by
a stronger dollar, while base metals were softer. [] []
Strength in gold lifted the other precious metals, which are
mostly used in industry. Earlier, they retreated in line with
other industrial commodities like copper and aluminium.
Silver <XAG=> was bid at $17.06 an ounce against $17.02,
platinum <XPT=> was at $1,616 an ounce against $1,604.50, while
palladium <XPD=> was at $461 against $460.
(Editing by Sue Thomas)
