* Gold holding near highs; safe haven fears support
* May see downward correction before resuming uptrend
* Coming up: U.S. inflation data at 1230 GMT
(Updates prices)
By Amanda Cooper
LONDON, June 28 (Reuters) - Gold edged up on Monday toward
last week's record high, buoyed by a dip in the dollar in Asian
trading, worries about the global economy and U.S. comments that
Iran has enough fissile material for two atomic bombs.
But a lack of consumer demand, including the prospect of a
sharp contraction in demand from India, the world's largest gold
consumer, might mean prices could push lower in the near term.
"I think it needs to correct," said Simon Weeks, head of
precious metals at the Bank of Nova Scotia.
"The weaker dollar and weaker sentiment is probably more
positive than negative. But markets are already pretty long, and
quite frankly there is no huge amount of fresh demand around. So
on that basis, I'm slightly surprised that we are as high as we
are," he said.
Spot gold <XAU=> rose $2.20 to $1,255.60 an ounce by 1152
GMT, having hit an all time high of $1,264.90 an ounce last
Monday. U.S. gold futures for August delivery <GCQ0> rose 30
cents to $1,256.50 an ounce.
Weeks said he saw gold prices moving back through $1,230
towards $1,200 an ounce from current levels.
The dollar was holding roughly steady against a basket of
six major currencies <.DXY> but is still hovering around its
lowest level in six weeks as concerns about the pace of U.S.
recovery persisted and after data showed speculators had cut
back their bets on the greenback last week. []
Coming up at 1230 GMT is U.S. core inflation data for May.
The so-called core PCE index is the Federal Reserve's favoured
measure of price pressures.
The head of the Bombay Bullion Association said on Monday
that gold imports into top consumer India are likely to have
fallen by 75 percent in June from 29.9 tonnes a year ago. Suresh
Hundia, president of BBA, told Reuters this bearish estimate
could be overly optimistic and the final figures could be lower
than this.
"The numbers are so bad, nobody wants to share it this
time," he said referring to the importing banks and trading
agencies, which contribute their data to the trade body.
[]
STILL A SAFE HAVEN
Ongoing doubt about the resilience of the global economic
recovery helped maintain support for gold.
"The underlying safe-haven concerns that have supported
prices -- the economic environment, Europe's fiscal outlook and
the longer-term prospects for inflation, remain," said David
Moore, commodities strategist at Commonwealth Bank of Australia.
"The G20 hasn't had a significant impact on markets, and
while concerns about Iran's nuclear capacity are nothing new,
there seems to be additional clarity."
With this in mind, gold could rise further to surpass the
June 21 record at $1,264.90 per ounce to touch $1,270, as
bullish momentum is strong, according to Reuters technical
analyst Wang Tao.
He noted the bulls were taking control, with prices in an
ascending channel from a $1,224.30 low struck last Wednesday and
sharp rises and mild falls. []
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The world's largest gold-backed exchange-traded fund, SPDR
Gold Trust <GLD.P> said its holdings remained unchanged at an
all-time high at 1,316.177 tonnes. []
U.S. lawmakers hammered out a historic overhaul of financial
regulations, handing President Barack Obama a major domestic
policy victory. [] []
"The U.S. regulations are pretty worrying. That's something
that we will need to look at more closely," a commodities
trading source in Singapore said.
"So far, people are taking a wait-and-see attitude and it's
hard to assess the impact on prices."
Dozens of House Democrats had threatened to vote against a
ban on swaps trading on grounds the trade would move overseas.
Instead a compromise solution allows banks to stay involved
in foreign-exchange and interest-rate swaps dealing, which form
the bulk of the $615 trillion over-the-counter derivatives
market, as well as gold and silver swaps and derivatives
designed to hedge their own risk. []
Elsewhere, silver <XAG=> was up at $19.07 an ounce, from
$19.04 late in New York on Friday, while in the platinum group
metals complex, platinum <XPT=> rose 1.2 percent to $1,582.50
and palladium <XPD=> was up about 0.8 percent at $478.30.
(Additional reporting by Nick Trevethan in Singapore)
(Editing by Keiron Henderson and Jane Baird)
