* Dollar firms vs euro ahead of expected ECB rate cut
* Traders eye U.S. data, central bank rate cuts for impetus
* U.S. November car sales tumble 37 pct
(Adds comment, updates prices)
By Jan Harvey
LONDON, Dec 3 (Reuters) - Gold lost further ground on
Wednesday as the dollar strengthened against the euro ahead of
an expected rate cut by the European Central Bank, and equities
dipped after a weaker-than-expected U.S. jobs report.
Traders are awaiting a spate of interest rate decisions,
including that of the ECB on Thursday, and key U.S. non-farm
payrolls numbers on Friday to give fresh impetus to the markets.
Weakness on the equity markets, which softened after a
report showed U.S. private employers slashed a larger than
expected 250,000 jobs in November, is feeding through into gold.
Spot gold <XAU=> slipped to $768.80/770.80 an ounce at 1455
GMT from $781.50 an ounce in New York late on Tuesday.
"As we come towards the year end there is a huge need for
dollars to square books, so the dollar will stay bid," said
Calyon metals analyst Robin Bhar.
Gold may weaken further if the dollar continues to benefit
from risk aversion, he added. "We have seen that although gold
may be supported by safe haven fears over further systemic risk,
it can be more than outweighed by financial deleveraging," he
said.
Gold is often bought as an alternative to the dollar and
typically moves in the opposite direction to the U.S. currency.
The currency markets are subdued ahead of rate announcements
from the ECB, the Bank of England and the Reserve Bank of New
Zealand on Thursday. The ECB is expected to cut rates by 50
basis points to 2.75 percent. []
Gold shrugged off steadier oil prices, with inflation fears
tempered by crude's sharp dip at the beginning of this week.
Traders are awaiting U.S. stockpiles data due later in the
session. []
Physical offtake of gold is also slowing, traders said. In
India, the world's largest bullion market, domestic gold buying
declined as well-stocked traders awaited further price falls.
"We have many buy orders at $750 (an ounce) levels," a
dealer at a Mumbai bank said. []
Among other precious metals, spot silver <XAG=> tracked gold
lower to $9.45/9.53 an ounce from $9.54.
CAR SALES TUMBLE
Platinum prices steadied after earlier climbing almost 4
percent to a session high of $832.00 an ounce.
"Disastrous U.S. car sales for November should limit any
further advance," analysts at Commerzbank said in a research
note.
Spot platinum <XPT=> was quoted at $791/811 an ounce against
$796 late in New York on Tuesday.
Data released on Tuesday showed U.S. car sales tumbled
nearly 37 percent in November, the 13th consecutive month of
falls, to their lowest level since 1982.
Sales at GM <GM.N> and Chrysler fell 41 percent and 47
percent respectively in November. Carmakers said there was no
sign demand would rebound in the next six months. []
Car and truck makers around the world signalled fresh
production cuts and job losses Wednesday, with some warning the
slump in demand may last until 2010. []
However, with platinum having already fallen two-thirds from
the highs it hit in March and much of the bad news already
priced in, the market showed little reaction to the news.
"The platinum group metals market has come to expect the
worse, and much of this bearish news has been priced in
already," Standard Bank analyst Walter de Wet said.
Meanwhile palladium <XPD=> was little changed at
$170.50/178.50 an ounce against $169.
A Reuters survey showed platinum, palladium and silver are
expected to record sharp price falls in 2009 as demand sags in
line with economic growth. []
(Reporting by Jan Harvey; editing by Peter Blackburn)
