* Gold edges down as dollar bounces versus euro
* Gold nearly 9 pct below record, holds near 2-week low
(Updates prices, adds quotes)
By Lewa Pardomuan
SINGAPORE, Feb 25 (Reuters) - Gold edged down on Thursday
after the U.S. dollar rebounded against the euro, while firmer
oil prices offered little help as investors turned cautious on
bullion after it failed to sustain recent gains.
Gold dropped below a psychological level of $1,100 an ounce as
uncertainties in the outlook for the euro blamed on Greece's
debt crisis prompted some investors to shift their money to the
dollar or stocks. Gold struck 1-month high around $1,130 on
Monday.
Spot gold <XAU=> was at $1,097.05 an ounce by 0143 GMT,
down 20 cents from New York's notional close on Wednesday, when
it fell as low as $1,089.45 an ounce, its weakest in almost two
weeks. Gold was nearly 9 percent below a record of around
$1,200 hit in December.
"The perception is we're back in a period of a little bit
of limbo," said Darren Heathcote, head of trading at Investec
Australia in Sydney.
"Now we need to get things started again. Either we are
going to go downhill further or we are going to continue with a
recovery. I think we are just waiting for some impetus to push
us in one direction or the other," he added.
The world's largest gold-backed exchange-traded fund, SPDR
Gold Trust <GLD>, said its holdings stood at 1,106.987 tonnes
as of Feb. 24, unchanged from the previous business day.
[] The holdings hit a record high of 1,134.03 tonnes on
June 1.
U.S. gold futures for April delivery <GCJO> fell $1.0 to
$1,096.20 per ounce. It had hit an intraday low around $1,090
on Wednesday before bouncing slightly at the close, suggesting
that bargain hunters would snap up gold at lower levels.
The euro <EUR=> fell to $1.3497 on Thursday after gaining
around 0.2 percent in the previous day as worries about a
possible downgrade of Greece lingered. []
The dollar had weakened on Wednesday as investors trimmed
huge long positions in the greenback after the Federal Reserve
reiterated interest rates will stay low for a long time.
German Chancellor Angela Merkel said in a newspaper
interview published on Wednesday that the euro is in a
difficult position for the first time but will weather the
storm, adding that debt-ridden euro zone members such as Greece
had to tackle their own problems. []
"We have a few contradicting factors. The euro is weak but
other commodities and crude oil are firm, that's why gold
doesn't drop so much," a dealer in Hong Kong said.
U.S. crude futures edged higher above $80 a barrel on
Thursday, adding to gains made the previous day after Bernanke
reaffirmed his commitment to keeping interest rates low.
Shanghai copper rose 0.1 percent, tracking gains on the LME.
[] []
Gold, traditionally seen as a safe haven in times of
economic uncertainty, has been moving in tandem with asset
classes perceived as riskier, including equities and other
commodities such as oil.
Precious metals prices at 0226 GMT
Metal Last Change Pct chg YTD pct chg
Turnover
Spot Gold 1097.05 -0.20 -0.02 0.12
Spot Silver 15.91 -0.05 -0.31 -5.47
Spot Platinum 1515.50 10.50 +0.70 3.31
Spot Palladium 423.75 3.75 +0.89 4.50
TOCOM Gold 3179.00 -41.00 -1.27 -2.45
59977
TOCOM Platinum 4370.00 -20.00 -0.46 -0.25
12558
TOCOM Silver 46.60 -0.10 -0.21 -9.86
697
TOCOM Palladium 1219.00 -19.00 -1.53 4.64
199
Euro/Dollar 1.3493
Dollar/Yen 89.74
(Editing by Himani Sarkar)
