* Fiscal woes support gold but strong dollar caps gains
* Gold priced in euro, sterling approaches record highs
* Investors await Friday's U.S. non-farm payrolls data
(Updates, adds comment, changes dateline from SINGAPORE)
By Michael Taylor and Jan Harvey
LONDON, March 2 (Reuters) - Gold prices rose above $1,120 an
ounce on Tuesday as persistent worries about Greece's fiscal
health and instability in the currency markets lent some
safe-haven support, but strength in the dollar capped gains.
Gold priced in euros <XAUEUR=R> and sterling <XAUEUR=R>
approached their recent record highs, however, as both
currencies slipped on Tuesday.
Spot gold <XAU=> was bid at $1,121.60 an ounce at 1151 GMT,
against $1,118.40 late in New York on Monday. U.S. gold futures
for April delivery <GCJ0> on the COMEX division of the New York
Mercantile Exchange rose $3.70 to $1,122.00 an ounce.
"The dollar has tested recent highs against the euro... but
that is not dragging gold down, so obviously there is an
underlying strength in gold at these prices," said Saxo Bank
senior manager Ole Hansen.
"With the uncertainties going on at the moment, apart from
the currency relationship, there hasn't been any particular
reason for selling it."
"Gold is doing a bit of sideways trading. We have non-farm
payrolls on Friday in the U.S., so we would expect the market to
wait for that," he added.
The euro fell to a 9 1/2-month low versus the dollar on
Tuesday as further worries over Greek austerity measures added
to selling pressure on the single European currency. []
Fears over the fiscal health of peripheral euro zone
economies have weighed heavily on the euro so far this year,
knocking it down by nearly 5.5 percent against the dollar.
The European Union on Monday urged Greece to agree
additional austerity measures within days to tackle its fiscal
crisis. Greek officials said a cabinet meeting on the economy
will take place on Wednesday. []
Adding to pressure on the euro, former European Central Bank
economist Otmar Issing said Greece should turn to the
International Monetary Fund rather than other euro zone states
for help in tackling its debt crisis. []
Euro-priced gold rose above 830 euros an ounce on Tuesday,
within a few cents of its record high of 830.41 euros an ounce
set last week.
STERLING GOLD EYES HIGH
Sterling-denominated gold also rose above 750 pounds an
ounce, near Monday's record high at 753.69 pounds an ounce,
meanwhile, as the British currency was driven lower by fears
that the next UK general election could result in a hung
parliament.
"For gold, all the action is in non-U.S. dollar currencies,"
said Commerzbank in a note. "Given that the U.S. dollar has
recently gained in strength, gold expressed in U.S. dollars is
also holding up astonishingly well."
In the physical market, sales of gold scrap picked up in
Southeast Asia due to recent gains in bullion prices, while
Indian buyers stayed on the sidelines. []
The world's largest gold-backed exchange-traded fund, SPDR
Gold Trust <GLD>, said its holdings stood at 1,106.987 tonnes by
March 1, unchanged from the previous business day. []
Elsewhere, silver <XAG=> was at $16.58 an ounce against
$16.45, platinum <XPT=> at $1,557 an ounce versus $1,546.50, and
palladium <XPD=> at $436.50 an ounce versus $433.50.
Analysts said strong fundamentals and ETF inflows were
helping support both platinium and palladium prices.
Global commodities prices are expected to rise slightly due
to some demand from emerging market economies but a broad-based
price spike is unlikely, a senior International Monetary Fund
official said on Monday. []
(Reporting by Jan Harvey; Editing by Amanda Cooper)
