* Opposing forces of firm dollar, haven demand balance gold
* Markets await fresh news on debt-laden Greece
* Oil prices slip back below $82/barrel
(Updates prices)
By Jan Harvey
LONDON, March 19 (Reuters) - Gold edged lower in Europe on
Friday as persistent weakness in the euro kept the precious
metal under pressure, but traders were cheered by its resilience
to a rising dollar in recent sessions.
Spot gold <XAU=> was bid at $1,120.95 an ounce at 1211 GMT,
against $1,125.45 late in New York on Thursday. U.S. gold
futures for April delivery <GCJ0> on the COMEX division of the
New York Mercantile Exchange eased $5.90 to $1,121.60 an ounce.
The metal traded choppily in a narrow range on Thursday,
caught between downward pressure from the rising dollar and the
positive impact of safe-haven buying. It is seen keeping to a
relatively narrow range as it awaits further impetus.
"On the one side the dollar is weighing on prices, but on
the other we are seeing continued inflows from investors," said
Commerzbank analyst Eugen Weinberg. "Gold has been resilient
against dollar strength, which is actually a good sign."
"As long as we are trading above $1,120, we will be pretty
much rangebound," he added. "Should prices drop below there, we
could see some downward pressure developing, but at the moment
we are seeing a sideways move on gold."
The euro slipped to a one-week low on Friday, pressured by
nagging concerns about Greece's deficit problems, as traders
waited to see if Athens can secure aid from euro zone members at
a summit next week. []
The single currency has slipped 5 percent versus the dollar
this year as investors fret over the outlook for debt-laden
Greece. The country said on Thursday it cannot achieve promised
deficit cuts if its borrowing costs remain so high, and may have
to call in the IMF. []
Fears over euro zone sovereign debt issues have helped boost
interest in gold as a safe store of value, traders said.
DEMAND OUTLOOK POSITIVE
Expectations physical demand will recover this year as
prices stabilise after last year's volatility are underpinning
the market, analysts said.
A senior official at the World Gold Council said on Thursday
that global gold demand was expected to rise in 2010 after a
fall last year, with economic recovery driving jewellery demand
and fuelling investor appetite for bullion. []
From a technical perspective, gold is facing few immediate
pressures, traders said. "Gold is looking very ordinary near the
middle of our multi week range of $1,099 to $1,145,"
ScotiaMocatta said in a note.
Meanwhile oil slipped below $82 a barrel on Friday as the
dollar strengthened against the euro on worries over Greece's
debt problems, and after an industry report suggested OPEC
exports were rising. []
Gold tends to track crude prices, as the metal can be bought
as a hedge against oil-led inflation.
Silver <XAG=> was at $17.24 an ounce against $17.35.
"We continue to expect silver prices to draw upside momentum
(from) gold prices rather than finding support via its own
supply and demand dynamics," said Barclays Capital in a note.
"Even though we expect industrial activity to support the
demand picture for silver, the metal's price trajectory
continues to rest in the hands of investors."
The bank said it expects growth in mine supply to keep
the market balance in surplus in 2010.
Among other precious metals, platinum <XPT=> was bid at
$1,619 an ounce against $1,627, while palladium <XPD=> was at
$476 an ounce against $475 an ounce.
Both metals have corrected after trading to multi-month
highs last week amid expectations recovering industrial demand
and strong buying by investors this year will support prices.
(Editing by James Jukwey)
