* Haven buying supports gold despite weaker euro, commods
* Spanish, Portuguese CDS rise amid contagion fears
* Gold increasingly expensive versus silver, platinum
(Updates, adds comment, changes dateline from SYDNEY)
By Jan Harvey
LONDON, May 5 (Reuters) - Gold held above $1,170 an ounce in
Europe on Wednesday as safe-haven buying on fears Greek-style
debt woes could spread elsewhere in the euro zone offset
strength in the dollar and losses in other commodities.
Spot gold <XAU=> was bid at $1,172.00 an ounce at 0930 GMT,
against $1,170.65 late in New York on Tuesday. U.S. gold futures
for June delivery <GCM0> on the COMEX division of the New York
Mercantile Exchange rose $4.00 to $1,173.20 an ounce.
European Central Bank Governing Council member Axel Weber
said on Wednesday there is a serious threat of Greece's problems
spilling over to other parts of the euro zone. []
His comments helped lift gold from a low of $1,164.70 an
ounce, hit in early European trade.
"We think the flight to safety will continue, and we expect
to see more inflows into physical gold products like exchange
traded funds," said Commerzbank analyst Daniel Briesemann.
"As long as uncertainties on the markets persist, gold
should remain well-supported. We have seen record highs in
euros, Swiss francs and sterling in the last few days and it
should only be a matter of time before gold reaches new record
highs in dollars as well."
Gold touched a dollar high of $1,226.10 last December.
The premium investors demand to hold debt issued by
peripheral euro zone countries over German benchmark bonds rose
on Wednesday as concern over the creditworthiness of economies
like Greece, Spain and Portugal persisted. []
An official at ratings agency Standard & Poor's said that
while it is not pessimistic about the chance of a Greek default,
a multi-billion euro EU/IMF aid package announced on Sunday does
not remove the risks facing the country. []
"Greece is set to receive a 110 billion euro aid package,
yet uncertainty remains and the problem will not disappear
overnight, not least amid concerns over other indebted euro zone
members," said VTB Capital analyst Andrey Kryuchenkov in a note.
JEWELLERY DEMAND SOFT
Rising prices weighed on jewellery demand, with dealers in
major gold consumer India sticking to the sidelines on Wednesday
as the weak rupee also pressured sentiment. []
Investment interest held firm, however, with holdings of the
world's largest gold-backed exchange-traded fund, New York's
SPDR Gold Trust <GLD>, still at a record high on Tuesday.
Prices are poised for further gains from a technical
perspective, according to analysts who study past price moves
for clues as to the future direction of the market.
"Over the past several weeks, (gold) has forged higher highs
in the face of sideways equities, a stronger dollar, and heavy
commodities generally," said Barclays Capital in a note.
"This speaks to the strength of the larger bull trend, with
the head and shoulders base targeting $1,250 in Q2, but
ultimately $1,500 into the end of the year."
Risk aversion battered other markets, with the euro hovering
near a one-year low on Wednesday. Oil slipped further towards
$82 a barrel, extending its steepest one-day loss in three
months, while European shares fell. [] [] []
Gold has outperformed other, more industrial precious metals
in recent weeks as Greece's debt woes weighed on industrial
commodities while lifting haven flows into gold.
The ratio of gold to silver -- the number of ounces of
silver needed to buy an ounce of gold -- rose as high as 66.3 on
Wednesday, a two-month high, while the gold-platinum ratio hit
its highest since early March at 0.7.
Silver <XAG=> was at $17.80 an ounce against $17.84, while
platinum <XPT=> was at $1,667.50 an ounce versus $1,668.50 and
palladium <XPD=> was at $507 against $515.50.
(Reporting by Jan Harvey; Editing by Keiron Henderson)
