* Demand from jewellers slow in Asia
* Coming Up: U.S. Redbook mm Weekly; 1355 GMT
(Updates prices)
By Lewa Pardomuan
SINGAPORE, Dec 21 (Reuters) - Gold firmed on Tuesday as
fears of further ratings downgrades in Europe spurred buying
from speculators, but demand from jewellers slowed to a
trickle in Asia, with most orders already filled before the
year-end holidays.
The euro inched up, but gains could be limited by worries
that some euro zone countries and banks could face more
borrowing strains after Moody's said it may cut the ratings on
Spanish banks. Speculation has also risen that France and
Belgium may face cuts.
Spot gold added $2.90 an ounce to $1,387.80 an
ounce by 0706 GMT in thin trade, which means that prices are
prone to sharp movements. Gold was well below a historical
high of around $1,430 hit earlier this month.
The euro zone worries were likely to be the main
supporting factor for bullion after tensions in the Korean
peninsula eased, with North Korea stepping back from
confrontation over "reckless" military drills by South Korean
military. []
"The volume is light, so a little buying will push up
gold. There's not too much sale of scrap at these levels. Next
year will be a good year again for gold," said Ronald Leung,
director of Lee Cheong Gold Dealers in Hong Kong.
"There are (ratings) downgrades in Europe, almost every
day."
Premiums for gold bars were at $1 an ounce to the spot
London prices in Hong Kong, steady from last week.
.
U.S. gold futures for February rose $2.9 to $1,389
an ounce.
China, which has invested an undisclosed portion
of its $2.65 trillion reserves in the euro, urged European
authorities to back their tough talk with action by showing
they can contain the euro zone's simmering debt problems and
pull the bloc out of its crisis soon. []
Gold, which has gained by almost 30 percent this year, is
on track for a fifth successive month of gains, partly driven
by the debt crisis in Europe.
Greater inflows into bullion-backed, exchange-traded funds
and increased open interest in U.S. futures have helped fuel
gold's price rise this month.
In equities, Japan's Nikkei average hit a seven-month
closing high on Tuesday in holiday-thin trade, as a rebound in
Chinese equities encouraged investors to buy on dips.
"We do see some physical demand out of Thailand. When the
price came off last week, we did see buying from Indonesia,
but other than that, people are waiting for Christmas and New
Year," said a dealer in Singapore.
"It will be too late to buy gold to stock up now. Towards
the year-end, there are not many orders from jewellers."
Premiums for gold bars were steady at 70 cents in Singapore.
Oil prices rose for the third straight session on Tuesday,
supported by cold weather in the United States and Europe,
seasonal gasoline demand, and an expected drop in U.S. crude
stocks.
Precious metals prices at 0706 GMT
Metal Last Change Pct chg YTD pct chg Turnover
Spot Gold 1387.80 2.90 +0.21 26.66
Spot Silver 29.36 0.03 +0.10 74.45
Spot Platinum 1706.85 14.85 +0.88 16.35
Spot Palladium 744.97 4.97 +0.67 83.72
TOCOM Gold 3739.00 -5.00 -0.13 14.73 25442
TOCOM Platinum 4654.00 11.00 +0.24 6.23 7431
TOCOM Silver 79.10 -0.10 -0.13 53.00 1247
TOCOM Palladium 2020.00 4.00 +0.20 73.39 312
Euro/Dollar 1.3191
Dollar/Yen 83.66
TOCOM prices in yen per gram. Spot prices in $ per ounce.
(Editing by Himani Sarkar)
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