* Gold rises in slow trade, eyes on EU summit
* Euro gains, oil moves towards $75, gold ETF flat
(Updates prices, adds details)
By Lewa Pardomuan
SINGAPORE, Feb 11 (Reuters) - Gold gained on Thursday after
the euro bounced against the U.S. dollar ahead of a European
Union summit that may decide to help debt-laden Greece avoid
default and eventually restore confidence in the single
currency.
Gold has dropped around 12 percent since striking a record
at $1,226.10 in December as the dollar gained on mounting
fiscal worries in the euro zone, and recently on U.S. Federal
Reserve Chairman Ben Bernanke's comments about a stimulus
pullback.
Spot gold <XAU=> was quoted at $1,078.20 an ounce by 0558
GMT, up $6.65 from New York's notional close on Wednesday. It
had hit an intraday high of $1,080.25 an ounce.
"Obviously the anticipation is that we're going to get some
good news as far as support for Greece is concerned," said
Darren Heathcote, head of trading at Investec Australia in
Sydney.
"If the dollar does unwind tonight, if we get a good result
from the European Council, then you can expect that gold is
going to go higher. We'll certainly be targeting $1,100 again.
Once the dust settles, gold will be higher," said Heathcote,
referring to a high seen last week.
Other precious metals also rose, tracking gains in gold,
with platinum <XPT=> moving away from a 5-week low hit last
week. U.S. gold futures for April delivery <GCJO> added $2.1 an
ounce to $1,078.4 an ounce.
European Union leaders will hold a summit on the economy
Thursday and there was growing speculation a package would be
hammered out for Greece. [].
The euro <EUR=> rose to $1.3785, having fallen 0.4 percent
on Wednesday. It has dropped more than 4 percent this year on
mounting worries over how some euro zone countries like Greece,
Portugal and Spain will service their debt. []
In his most comprehensive description to date of how the
Fed aims to withdraw its stimulus, Bernanke said the U.S.
central bank could soon raise the discount rate it charges
banks for emergency loans, but stressed that would not be akin
to a tightening in monetary policy. []
In theory, a firmer dollar reduces gold's appeal as an
alternative investment.
Trading was thin in Asia due to the absence of Japanese
players and ahead of the Lunar New Year, although dealers noted
bargain hunting in Hong Kong due to a firmer euro as well as
strong economic data from China and Australia. []
[]
"People are optimistic about the future of the economy in
Asia after seeing the data. But I don't really see physical
buying and trading volume is low," said a dealer in Hong Kong.
The world's largest gold-backed exchange-traded fund, SPDR
Gold Trust <GLD>, said its holdings stood at 1,106.378 tonnes
as of Feb. 10, unchanged from the previous business day.
[]
Oil <CLc1> climbed toward $75 a barrel on Thursday,
extending the previous session's gain of 1 percent, buoyed by
an upbeat oil demand growth forecast by the U.S. Energy
Information Administration and hopes of a rescue plan for
Greece. []
Precious metals prices at 0558 GMT
Metal Last Change Pct chg YTD pct chg
Spot Gold 1078.20 6.65 +0.62 -1.60
Spot Silver 15.41 0.23 +1.52 -8.44
Spot Platinum 1519.00 12.00 +0.80 3.54
Spot Palladium 414.00 2.50 +0.61 2.10
Euro/Dollar 1.3785
Dollar/Yen 89.86
(Editing by Himani Sarkar)
