* Euro drops as Greek/German bond yield spreads widen
* Chancellor Merkel says Greece aid depends on Greek savings
* Euro-priced gold hits record high at 868.57 euros/oz
* Coming up: Fed monetary policy meeting starts Tuesday
(Updates prices, adds comment)
By Jan Harvey
LONDON, April 26 (Reuters) - Gold held near $1,155 an ounce
in Europe on Monday, largely shrugging off euro weakness, as
uncertainty over how and when Greece would receive financial aid
boosted the metal's appeal as a haven from sovereign risk.
Spot gold <XAU=> hit a peak of $1,159.73 an ounce in earlier
trade, its highest since April 15, and was at $1,155.25 an ounce
at 1517 GMT versus $1,155.90 late in New York on Friday.
The combination of risk-averse buying and euro weakness took
euro-priced gold <XAUEUR=R> to a record 868.57 euros an ounce.
The euro slipped on Monday as the spread between Greek and
German bond yields widened after Germany said it had not yet
committed to providing financial aid to Greece. []
While euro weakness would usually weigh heavily on gold,
other factors are supporting the precious metal, analysts said.
"If you look at the past few months and how gold often
traded, it held up very well in an environment of a declining
euro and a strengthening dollar," said Michael Widmer, an
analyst at Bank of America-Merrill Lynch.
"There has been steady demand for gold from the Europeans."
U.S. gold futures for June delivery <GCM0> on the COMEX
division of the New York Mercantile Exchange rose $3.70 to
$1,157.40 an ounce.
Concerns over the outlook for smaller euro zone economies
like Greece have pressured euro 7 percent lower versus the
dollar this year, but gold is up 5 percent in the same period as
sovereign risk fears have lifted interest in bullion as a haven.
"Gold is showing its attraction as a safe haven once again,"
said Commerzbank in a note. "The Greek government officially
requested help from the Eurogroup and the IMF on Friday."
"The uncertainty on financial markets persists, however, as
the aid package for Greece first has to be approved by the
national parliaments of the eurozone states."
Fears over Greece are lingering despite its finance minister
saying on Sunday that aid from the EU and IMF would avert what
would be the euro zone's first sovereign debt default.
[]
German Chancellor Angela Merkel said on Monday Greece must
commit to further savings measures and show it can return to a
sustainable economic path before Germany can approve emergency
aid. []
FED EYED
Markets are now awaiting the outcome of a two-day meeting of
the U.S. Federal Reserve starting on Tuesday. The Fed is
expected to keep interest rates unchanged near zero and repeat
its pledge to keep them low for an extended period. []
Figures from the U.S. Commodity Futures Trading Commission
showed net long positions in New York gold futures fell slightly
last week, but analysts say the drop was slight given the
strength of the rise in positioning earlier this month.
"While the metal has taken a step back from nearing the all
time positioning high, there is just 4.4 million ounces of a gap
to the Oct. 2009 record," said UBS analyst Edel Tully in a note.
"Considering how fast and furious buyers rushed into the
market in the first half of April and alongside the volatile
price action in the week to April 20, it is somewhat comforting
that the net long exodus was contained at 0.8 million ounces."
Silver <XAG=> was at $18.35 an ounce against $18.27,
platinum <XPT=> at $1,746 an ounce against $1,740, and palladium
<XPD=> at $567 against $562.50.
Prices of minor precious metals iridium and ruthenium also
climbed amid talk of better buying out of Asia. Iridium
<IRID-LON> reached a 16-year peak at $560 an ounce, while
ruthenium <RUTH-LON> hit its highest since Oct. 2008 at $220.
(Editing by William Hardy)
