* Gold holds, consumer demand offsets rise in risk appetite
* Coming up: U.S. federal budget for August; 1800 GMT
(Updates throughout with comment, refreshes prices)
By Amanda Cooper
LONDON, Sept 13 (Reuters) - Gold eased on Monday, buckling
under the weight of positive investor sentiment stemming from a
deal on global banking rules, upbeat Chinese data and a rally in
risk-linked assets such as equities and the euro.
Other industrial commodities such as crude oil, platinum
group metals and copper all benefitted from the perception that
the outlook for global growth had brightened somewhat.
The agreement among global regulators on bank capital rules,
known as Basel III, requires the sector to raise hundreds of
billions of euros, but over a longer timeframe than originally
expected, which boosted financial shares.
Spot gold prices <XAU=> were at $1,244.30 an ounce by 1330
GMT, against $1,245 in New York on Friday. Yet prices remain
within around 1.5 percent of the all-time highs set in late June
at $1,264.90 when investor nervousness was heightened.
U.S. December gold futures <GCZ0> were down $0.9 ounce at
$1,245.60.
"The macro-environment hasn't changed significantly, but the
data is improving, also the Basel III agreement adds some
certainty about the future of the banking system even though it
triples the capital ratios," said Andrey Kryuchenkov, an analyst
at VTB Capital.
"In the long run ... gold is still well supported, not least
because of seasonal demand, because on every dip it will be
supported by demand in Asia," he said.
The new banking requirements will require banks to hold
top-quality capital totalling 7 percent of their risk-bearing
assets, but a long lead-in time eased fears that lenders will
have to rush to raise capital. []
U.S. stock markets opened higher <.SPX> on Wall Street,
while government bond prices eased in line with a dissipation in
the kind of risk aversion that has helped put gold on track for
a 14 percent rise this year. [] []
"It seems risk is a bit back on the table, with China
looking okay and Basel swinging the whip, but so far ahead that
it's going to take quite a few years for the banks to implement
(the rules)," Ole Hansen, senior manager at Saxo Bank, said.
Hansen said gold was facing fairly stiff resistance around
$1,260 and support was evident at $1,240, then around $1,222.
Adding to the pressure on gold was a broad-based decline in
the dollar, which fell 1 percent against the euro <EUR=> as
investors took on more risk. []
Gold usually benefits from weakness in the dollar, which
makes bullion cheaper to non-U.S. buyers, but the inverse
relationship between the two has eroded somewhat in recent weeks
as risk appetite has dominated flows into both assets.
UPBEAT DEMAND OUTLOOK
Although consumer demand in Asia was muted on Monday, this
time of year marks a period of intense offtake in India, the
world's largest consumer, while the outlook for demand in Europe
this year looks fairly bright.
Jewellery sales in Italy, Europe's largest jewellery market,
are likely to rise by 10-12 percent this year, and grow again
next year as consumer demand slowly improves after the economic
crisis, according to a senior industry official. []
Helping improve risk appetite was a pickup in Chinese
industrial production and money growth in August that reflected
buoyant economic growth despite government efforts to clamp down
on bank lending and property speculation. []
Michael Blumenroth, an analyst with Deutsche Bank, said if
an improving economic backdrop added to price pressures, this
would maintain gold's allure as a hedge against inflation.
"If risk appetite does come back and bonds go down and
stocks up, then people will get the inflation theme on the table
soon, then gold will be bought because of that," he said.
Silver and the platinum group metals rose along with other
industrial commodities such as crude oil <CLc1> and base metals
like copper <CMCU3> on the back of rising expectations for
demand from China, a major consumer of raw materials.
Spot silver <XAG=> was last at $19.93 an ounce, against
$19.84 on Friday, while platinum <XPT=> was at $1,536.98 an
ounce, against $1,536.98 and palladium <XPD=> was at $521.00,
from $514.63.
(Additional reporting by Maytaal Angel)
(Editing by Alison Birrane)
