* Euro retreats as fears linger over PIIGS
* Coming up: ECB meeting concludes at 1245 GMT
* Platinum, palladium target chart resistance
(Updates, adds comment, changes dateline from SINGAPORE)
By Jan Harvey
LONDON, March 4 (Reuters) - Gold retreated on Thursday from
the 6-1/2 week high it hit in the previous session as the euro
edged lower versus the dollar, but trading was subdued ahead of
a European Central Bank announcement on interest rates later.
Spot gold <XAU=> was bid at $1,136.85 an ounce at 0955 GMT,
against $1,139.35 late in New York on Wednesday. U.S. gold
futures for April delivery <GCJ0> on the COMEX division of the
New York Mercantile Exchange fell $5.80 to $1,137.50 an ounce.
Gold rose as high as $1,144.60 an ounce on Wednesday, its
strongest since Jan. 15, as dollar weakness added to fears over
the stability of the euro zone financial system to prompt buying
of gold.
But the single currency's retreat from highs against the
dollar on Thursday is putting the metal back under pressure.
"The pullback in the euro/dollar today is taking a little
wind out of gold's sails," said Societe Generale analyst David
Wilson. "There is still nervousness over the euro area,
particularly with strikes in Portugal over austerity plans."
Fears over the outlook for a number of smaller euro zone
economies, known as the PIIGS -- Portugal, Ireland, Italy,
Greece and Spain -- have helped push the single currency down
nearly 5 percent versus the dollar so far this year.
The euro gave back the gains made after Greece's latest
austerity package encouraged investors, as risk-taking was
subdued before central bank meetings in Europe and key U.S. jobs
data on Friday. []
The European Central Bank is seen keeping interest rates at
a record low 1.0 percent, and is also expected to outline the
next steps in its gradual withdrawal from emergency lending
measures. []
"The ECB (is) likely to signal some modest withdrawal of
liquidity provision at its meeting today," said Credit Agricole
CIB in a note.
OIL RETREATS
Among other commodities, oil prices slid towards $80 an
ounce as the firmer dollar dragged prices off seven=week highs
after news of another rise in U.S. crude inventories. []
Gold tends to track crude prices, as the metal can be bought
as a hedge against oil-led inflation.
On the wider markets, risk appetite was soft ahead of the
ECB meeting and an interest rates announcement from the Bank of
England, with European shares dipping from six-week highs. []
Asian shares failed to hold on to early gains on Thursday,
slipping lower as worries about Greece and the outlook for the
global economy made investors cautious. []
The world's largest gold-backed exchange-traded fund, SPDR
Gold Trust <GLD>, said its holdings stood at 1,115.511 tonnes as
of March 3, up from 1,111.556 tonnes in the previous business
day. []
On the supply side, Russia's gold lobby said the country's
gold output fell 59 percent in January from the previous month.
Russia is the world's fifth largest gold miner. []
Among other precious metals, spot silver <XAG=> was bid at
$17.11 an ounce against $17.17, platinum <XPT=> was at $1,575 an
ounce against $1,575.50, while palladium <XPD=> was at $456
against $446.50.
"Clearance of chart resistance at $1,594 in platinum and
around the $450 area in palladium would open the way to re-test
the January highs, as both metals gain further ground on
increasing investment and industrial demand," said James Moore,
an analyst at TheBullionDesk.com, in a note.
(Reporting by Jan Harvey; Editing by Sue Thomas)
