* Euro falls more than 1 pct as fears persist over euro zone
* Oil slides more than $1 after stocks data as dollar weighs
* SPDR gold ETF holdings rise to highest since January
(Updates prices, adds comment)
By Jan Harvey
LONDON, March 24 (Reuters) - Gold slid to a six-week low on
Wednesday as the dollar rose more than 1 percent versus the
euro, with a ratings downgrade of Portugal and persistent
worries over debt-laden Greece weighing on the single currency.
The dollar also took support from data showing new orders
for long-lasting U.S. manufactured goods rose for the third
straight month in February. []
Spot gold <XAU=> fell as low as $1,088.05 an ounce, its
weakest since Feb. 12, and was bid at $1,089.60 an ounce at 1258
GMT, against $1,101.65 late in New York on Tuesday.
The euro slid to its lowest since early May last year
against the dollar as investors flocked to the perceived safety
of the U.S. currency on concerns over the euro zone. []
It came under fresh selling pressure after Fitch Ratings
lowered Portugal's sovereign credit rating to AA- from AA, with
a negative outlook. []
"The Fitch downgrade of Portugal didn't help matters for the
euro," said VTB Capital analyst Andrey Kryuchenkov. "That was
another addition to already negative sentiment, another kick to
the euro."
"Gold is trading completely against the dollar at the
moment," he added.
U.S. gold futures for April delivery <GCJ0> on the COMEX
division of the New York Mercantile Exchange fell $14.00 to
$1,089.70 an ounce.
The euro's move comes ahead of a European Union summit later
this week, and after Germany signalled it may accept European
financial aid for Greece as a last resort. []
Uncertainty over Greece is likely to continue to weigh on
the euro, Credit Agricole said in a note.
"It looks unlikely that the summit will generate any
concrete EU plans that will sufficiently assuage market nerves,"
it said.
"Instead it seems that the Germans and the French, if
speculation is to be believed, both agree that the IMF should be
involved in any support."
OIL SLIDES
Gold typically falls as the dollar firms, as strength in the
U.S. unit curbs gold's appeal as an alternative asset and makes
it more expensive for holders of other currencies. That link
weakened earlier this year, but has since been restored.
For a graphic showing the correlation between gold prices
and the euro-dollar, click on:
http://graphics.thomsonreuters.com/gfx/SBrb_20102403095820.jpg
Among other commodities, oil also fell more than $1 a barrel
after a report showed a surge in U.S. crude inventories,
fuelling fears about demand recovery from industrialised nations
as Europe struggled to manage Greece's debt crisis. []
The world's largest gold-backed exchange-traded fund, New
York's SPDR Gold Trust <GLD>, said its holdings rose 4.6 tonnes
on Tuesday to 1,120.079 tonnes, their highest since Jan. 7.
[]
"The increase in ETF holdings yesterday is encouraging, as
is the scale of buying around and below $1,100, and suggests
further pockets of investment diversification will continue to
underpin prices," said TheBullionDesk.com analyst James Moore.
Silver <XAG=> was bid at $16.62 an ounce against $16.97,
tracking losses in gold, while platinum <XPT=> was at $1,575.50
an ounce against $1,607.
Palladium <XPD=> was the biggest faller among the precious
metals, sliding more than 4 percent to a session low of $443.50
an ounce. It was later at $447 against $464.50.
"The stronger dollar is the main reason for the drop," said
one platinum group metals trader. "The dollar hasn't been that
strong since May last year."
(Editing by Sue Thomas)
