* ECB cuts rates by 75 bps, BoE by 1 percentage point
* Oil slides as demand woes outweigh U.S. stockpile dip
* ZKB platinum ETF holdings rise 27 pct
(Updates prices, adds comment, detail)
LONDON, Dec 4 (Reuters) - Gold slipped on Thursday, slightly
extending losses made on the back of the firmer dollar earlier
in the session, as the European Central Bank cut rates by a
larger than expected 75 basis points.
A $1-a-barrel dip in oil prices is also pressuring the
precious metal, analysts said.
Spot gold <XAU=> slid to $766.00/768.00 an ounce at 1334 GMT
from $772.60 an ounce in New York late on Wednesday.
The ECB cut its benchmark rate by three-quarters of a point
to 2.50 percent, its lowest level in nearly 2-1/2 years, as
inflation plummeted and the euro zone economy sank deeper into
recession. []
This followed a full percentage point cut to 2 percent by
the Bank of England. []
Gold softened a touch on the news, but expectations of rate
cuts prevented a larger reaction.
"The ECB cut by more than was originally expected, but
overall a lot of it was already priced in," BNP Paribas analyst
Michael Widmer said. "Gold is still well within the ranges we
saw earlier in the day."
In the slightly longer term, rate cuts are likely to benefit
gold if they increase liquidity, analysts said.
"The recent sharp dip in inflation pushed up real interest
rates, exerting pressure on gold," Commerzbank said in a note.
"Generous rate cuts are therefore good for gold as they again
reduce the opportunity costs involved in holding it."
The dollar remained firmer, though off highs, against the
euro as investors worried about the breadth and depth of the
global recession bought into the currencies. []
A stronger dollar tends to weigh on gold, which is commonly
bought as a hedge against weakness in the U.S. currency.
Traders are now turning their attention to U.S. non-farm
payrolls data due on Friday for clues as to the next direction
of the currency markets, and therefore of gold.
Oil prices, the other main external driver of gold, added
pressure on the precious metal as they fell to a four-year low
on Thursday. []
Oil has been hit by concerns that a deep recession could
have a severe impact on demand. These outweighed the
price-positive effect of a 400,000-barrel drop in U.S. crude
inventories reported on Wednesday.
Physical demand is easing in some of gold's traditional
markets as traders await price falls. Indian buyers are looking
for prices of around $740 an ounce before making purchases,
dealers reported. []
PLATINUM STEADIES
Platinum prices were steady, but held only a touch over
those of gold, as traders worried about the impact of the
recession on carmakers, who account for around half of all
demand for the white metal.
"Concerns over industrial demand for the metals -
particularly from the auto sector - will continue to keep prices
under pressure for the time being," Standard Bank analyst Leon
Westgate said in a note.
"In the background however, mounting production cutbacks and
mine closures suggest that there may be a very rapid price
recovery once the first signs of increased metals demand start
to emerge," he added.
Spot platinum <XPT=> was quoted at $796.50/816.50 an ounce,
from $793.50 in New York trade late on Wednesday. Its sister
metal palladium was at $169/177 an ounce against $171.
Zurich Cantonal Bank said holdings of its platinum-backed
exchange-traded fund <ZPLA.S> rose 27 percent to 105,200 ounces
on Dec 1, from 83,000 ounces in September. Its palladium-backed
ETF saw inflows of 12 percent in the same period. []
Among other precious metals, spot silver <XAG=> slipped to
$9.42/9.50 an ounce from $9.63.
The world's largest silver-backed ETF, the iShares Silver
Trust <SLV.A>, said its silver holdings fell 32.24 tonnes to
6,651.79 tonnes on Dec 3. []
(Reporting by Jan Harvey; editing by Sue Thomas)
