* Euro steadies versus dollar after heavy losses
* Traders report fresh physical buying as prices fall
* Coming up: European Union leaders meet for summit
* Coming up: Fed's Bernanke testifies to Congress, 1400 GMT
(Updates, adds comment, changes dateline from SINGAPORE)
By Jan Harvey
LONDON, March 25 (Reuters) - Gold prices firmed in Europe on
Thursday, recovering some of the previous session's hefty
losses, as the euro steadied near 10-month lows against the
dollar, removing some downward pressure from the precious metal.
Spot gold <XAU=> was bid at $1,093.65 an ounce at 1031 GMT,
against $1,086.50 late in New York on Wednesday. U.S. gold
futures for April delivery <GCJ0> on the COMEX division of the
New York Mercantile Exchange rose $4.70 to $1,093.50 an ounce.
The precious metal fell to a six-week low of $1,084.85 an
ounce on Wednesday as the euro tumbled more than 1 percent
versus the dollar, but has met with good buying interest as
prices fell, traders said.
"We are still seeing safe haven buying of small coins and
bars, and as prices drop we see good physical demand in general,
which is absorbing some selling in the market," said Commerzbank
senior trader Michael Kempinksi.
"Without the safe-haven idea, gold would already be much
lower," he added.
Dealers reported physical demand for gold in India, the
world's biggest bullion consumer, rose after prices fell to
attractive levels, as traders resumed buying to stock up for the
wedding season that begins in April. []
The euro <EUR=> steadied but held near 10-month lows versus
the dollar hit on Wednesday as a ratings downgrade of Portugal
and persistent concerns about Greece's fiscal health weighed on
the single currency. []
Traders are looking ahead to a European Union summit
starting later in the day, at which plans to aid debt-laden
Greece will be discussed, and Federal Reserve chairman Ben
Bernanke's testimony to Congress on monetary policy at 1400 GMT.
EU leaders are working towards a last-minute agreement on
how to help Greece resolve its debt crisis. German Chancellor
Angela Merkel said International Monetary Fund and bilateral
European Union aid could be agreed as "last resort".
[] []
FOCUS ON GREECE
"The focus for the euro remains on Greece," said Credit
Agricole in a note. "The two-day EU Summit starts today with
muted hope that it will result in a clear and euro-friendly
resolution of the situation."
"The message that should resonate through the summit is that
the risk of negative fiscal sentiment spreading across the euro
zone has not gone away and remains a threat to the euro."
Among other commodities, oil prices turned higher, reversing
some of their earlier losses. []
Silver <XAG=> tracked gold higher, rising to $16.73 an ounce
from $16.53. Platinum <XPT=> was at $1,587 an ounce against
$1,577, while palladium <XPD=> was at $439 against $442.50.
Both platinum group metals have taken support from
expectations for a recovery in car demand this year. Platinum
and palladium are chiefly used in autocatalysts.
Investment demand is also expected to support prices after a
subsidiary of London's ETF Securities launched U.S.-based
platinum and palladium exchange-traded funds earlier this year.
ETFs issue securities backed by physical stocks of a given
asset, and have represented a significant source of demand for
precious metals in recent years.
"Two-way trade has been seen this morning but both (platinum
and palladium) are likely to find continued dip buying interest
as investment and industrial demand tightens market
fundamentals," said TheBullionDesk.com analyst James Moore.
"Available data suggest U.S. ETF holdings in platinum and
palladium have increased around 20,000 ounces over the past 48
hours," he said.
(Reporting by Jan Harvey; Editing by Susan Fenton)
