* Forex drives gold as fate of U.S. bank reform plan unclear
* Holdings of SPDR Gold stay flat for 2nd day []
By Risa Maeda
TOKYO, Feb 10 (Reuters) - Gold prices edged down on Wednesday
as the euro lost some of its gains from the previous day, when
reports of a possible European bailout for debt-stricken Greece
lifted the single currency and helped risk aversion to recede.
The euro fell after marking its best day of gains since
November on Tuesday, sapping the allure of gold, with investors
keen to see details of a rescue package for Greece and how it
could impact the euro zone economy. []
Concerns about Greece's public finances and potential
contagion effects have hit the euro and soured risk appetite in
recent weeks. European Union leaders will hold a special summit
on the European economy on Thursday.
Spot gold <XAU=> was at $1,075.35 per ounce as of 0606 GMT,
down 0.2 percent from New York's notional close of $1,076.95, and
off Tuesday's high of $1,083.05.
U.S. gold futures for April delivery <GCJ0> edged down 0.1
percent to $1,076.20 per ounce after rising $11 the previous day
on the COMEX division of the New York Mercantile Exchange.
On Friday, spot gold fell as low as $1,043.75, its lowest
since Nov. 2, as the euro fell on fears over the outlook for some
euro zone economies.
"On the surface, the currency market is a main driver for now
in the gold market and causing ups and downs in prices," said
Yuki Sonoda, an adviser at Daiichi Commodities Co in Tokyo.
"But what people really want to know is the fate of proposed
regulations on U.S. banks, because that will determine money
flows of risk-taking funds, and whether or not President Obama
will make compromises and how," he said, referring to stalled
financial regulatory reform plans.
President Barack Obama last month unveiled proposals to limit
risk taking by restricting some banks' most lucrative operations,
which he blamed for helping to cause the financial crisis.
[]
Imposing tighter regulations on U.S. banks as proposed could
send gold well below $1,000 per ounce, Sonoda said.
But if the banking reform plan follows the same course as
Obama's healthcare proposals, on which he has shown willingness
to compromise, it could send gold back to $1,200, Sonoda said.
The world's largest gold-backed exchange-traded fund, SPDR
Gold Trust <GLD>, said its holdings were at 1,106.378 tonnes as
of Feb. 9, unchanged for the second straight day. []
The holdings hit a record high of 1,134.03 tonnes on June 1.
PRICES
Precious metals prices at 0610 GMT
Metal Last Change Pct chg YTD pct chg Turnover
Spot Gold 1075.75 -1.20 -0.11 -1.82
Spot Silver 15.41 0.00 +0.00 -8.44
Spot Platinum 1495.50 -6.50 -0.43 1.94
Spot Palladium 412.75 -2.25 -0.54 1.79
TOCOM Gold 3110.00 28.00 +0.91 -4.57 55035
TOCOM Platinum 4301.00 50.00 +1.18 -1.83 18742
TOCOM Silver 45.00 0.70 +1.58 -12.96 517
TOCOM Palladium 1197.00 37.00 +3.19 2.75 241
Euro/Dollar 1.3759
Dollar/Yen 89.66
TOCOM prices in yen per gram. Spot prices in $ per ounce.
(Additional reporting by Chikako Mogi; Editing by Michael
Watson)
