* Euro-dollar near $1.35, further news awaited on Greece
* Oil prices slip towards $81/barrel
* Buying seen emerging in Asia as prices ease
(Updates prices, adds comment)
By Jan Harvey
LONDON, March 23 (Reuters) - Gold eased below $1,100 an
ounce in Europe on Monday as strength in the dollar versus the
euro pressured the metal, although physical buying is expected
to support the market as prices reach lower levels.
Gold slipped as low as $1,092.25 an ounce on Monday after
the rising dollar pushed the metal through key psychological
support at $1,100, but it later recovered.
Spot gold <XAU=> was bid at $1,097.45 an ounce at 1350 GMT,
against $1,101.60 late in New York on Monday. U.S. gold futures
for April delivery <GCJ0> on the COMEX division of the New York
Mercantile Exchange edged down $1.70 to $1,097.80 an ounce.
"The euro-dollar's retreat towards support at $1.35 is
dragging gold below the support zone, and charts hint that there
is potential for markets to sink below $1,080 in the near term,"
said Richcomm Global Services senior analyst Pradeep Unni.
"Though gold is finding bargain hunters around the $1,095
zone, the attractiveness of holding gold is being undermined by
the threat of rising interest rates. Further strength in the
dollar could trigger profit-taking in gold."
The euro slipped versus the dollar as European Union leaders
clashed over possible support for debt-laden Greece in the
run-up to a summit later this week. []
While German Chancellor Angela Merkel continued to rebuff
calls for a euro zone agreement, European Commission President
Jose Manuel Barroso urged Merkel to agree on a financial safety
net for Athens or risk harm to the euro. []
Gold watchers are awaiting the meeting for the fresh impetus
it may give the currency markets, analysts said.
"The $1.35 level for the euro is really key at this stage,"
Standard Bank analyst Walter de Wet said. "Yesterday, when we
had a drop below $1.35, gold fell quickly and the sell-off in
commodities was equally swift."
"As soon as gold gets to $1,095, there is really decent
physical demand, especially out of Asia, supporting it. That is
still in place, but that buying must be finite. If the dollar
continues to strengthen, the bias must be for gold to go lower."
OIL STEADY
Among other commodities, oil fell towards $81 a barrel,
under pressure as the dollar strengthened ahead of a European
Union summit. []
Physical gold prices in India, the world's biggest bullion
consumer, fell slightly on Tuesday, but traders may resume
buying at these levels to stock up for the wedding season that
begins from April, dealers said. []
Buying has been soft after an unexpected hike in short-term
borrowing and lending rates by the Reserve Bank of India on
Friday hurt sentiment.
Silver prices also eased, tracking gold, with spot silver
<XAG=> bid at $16.80 an ounce against $16.93.
Holdings of the world's largest silver exchange-traded fund,
the iShares Silver Trust <SLV>, fell 24.4 tonnes from the
previous day to 9,278.18 tonnes as of March 22. []
Platinum <XPT=> was at $1,594 an ounce against $1,597.50,
and palladium <XPD=> was at $453.50 against $454.50.
Platinum group metals prices have benefited from
expectations car demand in key markets such as the United States
and China will improve this year.
"Chinese official import data for February showed an 88
percent and 197 percent increase in platinum and palladium
imports (respectively) compared to February 2009," HSBC said in
a note.
"This confirms strong Chinese auto and jewellery demand, we
believe, and underpins prices going forward."
(Editing by Sue Thomas)
