* Gold recovers early losses as dollar retreats
* Tensions flare in North Africa as Libya fights protests
* Swiss palladium exports highest since July 2010
(Updates prices)
By Jan Harvey and Amanda Cooper
LONDON, Feb 22 (Reuters) - Gold steadied above $1,400 an
ounce on Tuesday as violence in North Africa fuelled interest in
the metal as a haven from risk, though its rise was limited as
some investors cashed in some of the previous session's gains.
Libyan leader Muammar Gaddafi used tanks, helicopters and
warplanes to fight a growing revolt in the country, which
follows uprisings that have toppled leaders in Tunisia and
Egypt. []
Spot gold <XAU=> was bid at $1,406.07 an ounce at 1617 GMT,
against $1,405.95 late in New York on Monday, having earlier
fallen as low as $1,392.54. U.S. gold futures for April delivery
<GCJ1> were up $18.00 from Friday's settlement to $1,406.60.
"Bullion prices continue to draw support from ongoing unrest
in the Middle East/North Africa region, also (from) a small
dollar pullback this afternoon," said Andrey Kryuchenkov, an
analyst at VTB Capital.
"Safe-haven buying remains the key driver behind the recent
rally as players seek to offset currency and sovereign risk," he
added. "The uptrend is well intact, with the market quickly
nearing key resistance around January and all-time highs."
Spreading unrest in the Middle East fuelled six straight
days of rising gold prices through Monday. A surge in the dollar
earlier in the day pulled prices back from seven-week highs, but
they have since recovered much of their early losses.
The dollar steadied against the euro as hawkish comments
from a European Central Bank official helped the single
currency, though the dollar is expected to benefit from ongoing
risk aversion as violence in Libya flares. []
German debt rallied and lower-rated euro zone sovereign
bonds came under pressure as intensifying violence there
prompted investors to shift into safe-haven assets, with the
Swiss franc also continuing a rise. [] []
EQUITIES RETREAT
European shares extended the previous session's decline as
violence in Libya exacerbated worries about unrest spreading
further across the region, while U.S. stocks fell. [] []
"Geopolitical tensions in the MENA region continue to
fester, keeping risk aversion elevated (as evident in the poor
performance of equities across the globe) and enhancing the
appeal of safe-haven assets," Standard Bank said in a note.
"In addition, the surge in oil prices is keeping fears of
rising global inflation alive."
Gold is still 2 percent below December's record high of
$1,430.95 an ounce, but dealers in Asia reported a pick-up in
sales of scrap after the spot price's near-4 percent rise over
the prior six sessions. []
Silver <XAG=> came under pressure in line with other
industrial commodities, falling by as much as 4.3 percent to a
low of $32.39 an ounce, as investors closed positions following
a three-day rally that lifted prices by nearly 4 percent.
It was later bid at $33.24 an ounce. The price hit its
highest since early 1980 at $34.30 an ounce earlier on Tuesday,
driven by limited supplies for near-term delivery and the
prospect for rising demand as the wider economy recovers.
The gold-silver ratio, which shows how many ounces of silver
can buy one ounce of gold, rose to around 42 from Monday's
13-year low near 41.
Elsewhere palladium <XPD=> was down 2.5 percent at $832.22,
while platinum <XPT=> was down 1.4 percent at $1,819.99.
Data from Switzerland, a major clearing hub for platinum
group metals in Europe, showed palladium exports reached their
highest since July 2010. []
Exports of palladium, used mainly in catalytic converters
for gasoline-powered vehicles, rose to 9,938 kg from 6,374 kg in
December, the largest amount since 11,731 kg in July last year.
(Reporting by Jan Harvey and Amanda Cooper, editing by Anthony
Barker)
