* Rising dollar adds pressure to gold prices
* SPDR gold ETF reports further small outflow
* Platinum group metals ease from multi-year highs
(Updates throughout, changes dateline, pvs SINGAPORE)
By Jan Harvey
LONDON, Feb 10 (Reuters) - Gold eased below $1,360 an ounce
in Europe on Thursday as the rising dollar pressured prices, and
with Asian buying still light after the Lunar New Year holidays.
The metal has fluctuated between $1,340 and $1,370 this
week, awaiting fresh direction. While there are currently few
incentives to buy gold, given improving appetite for higher risk
assets, few investors seem prepared to sell heavily.
Spot gold <XAU=> was bid at $1,358.06 an ounce at 1030 GMT,
against $1,362.89 late in New York on Wednesday. U.S. gold
futures for April delivery <GCJ1> fell $6.20 to $1,359.30.
The world's largest gold exchange-traded fund, New York's
SPDR Gold Trust <GLD>, reported a small outflow on Wednesday,
signalling that investment is still lacklustre. []
"Since the beginning of the year we have seen outflows from
the ETFs. We have seen lower risk aversion day by day, and today
the stronger dollar seems to be also taking its toll," said
Commerzbank analyst Eugen Weinberg.
"We are still very bullish in the longer term and believe
new all-time highs are very possible towards the end of the
year. But at the moment, gold seems to not be the favourite.
During economic recovery, other metals are in stronger demand."
The euro <EUR=> fell three-quarters of a percent against the
dollar on selling from a major Asian sovereign account, while
nagging doubts over a lack of concrete policy measures to tackle
the euro zone debt crisis hit sentiment. []
A stronger dollar tends to pressure gold, as it curbs its
appeal as an alternative asset and makes dollar-priced
commodities more expensive for holders of other currencies,
though the relationship has weakened in the last year.
On the wider markets, European shares continued their
retreat from the 29-month highs they hit earlier this week as
some corporate earnings reports missed expectations. []
ASIAN DEMAND SOFT
In India, the world's largest consumer of physical gold,
demand remained soft as buyers awaited fresh price falls.
Dealers said suppliers hiked premiums charged on London prices
to $2.20-$2.50 as availability was limited by supply issues
after heavy snowfalls in refining areas. []
Demand in number two consumer China was also muted after the
Lunar New Year holiday. Although the festival officially ended
on Wednesday, most buyers in China are not expected to return to
the market until Monday, dealers said.
Among other precious metals, silver <XAG=> was bid at $29.89
an ounce against $30.17, down more than 1 percent on the day.
Platinum <XPT=> was at $1,829.99 an ounce against $1,853.49,
while palladium <XPD=> was at $817.47 against $826.47.
Platinum reached its highest in 2-1/2 years on Wednesday and
palladium a ten-year peak, amid expectations that rising car
demand would lift consumption of the autocatalyst metals. Supply
issues are also supportive, analysts said.
"Platinum producers face high cost inflation driven by
rising labour and power costs and the impact of (rand)
appreciation," said Sanford Bernstein in a note.
"Platinum prices, unlike other commodities, have also been
relatively flat, resulting in falling margins, returns and cash
flows. In the short term, low profits and cash flows limit...
producers' ability and willingness to invest in new projects."
"We believe that supply constraints and likely demand
recovery make platinum an attractive commodity in the mid- to
long-term," it said.
(Reporting by Jan Harvey; Editing by Alison Birrane)
