PRECIOUS-Gold drops on Greek woes, China reserve hike

                                
 * Gold pressured by dollar rise, China's money tightening
                                
 * Euro remains depressed as Greece bailout details awaited
                                
 * Gold ends week 2 percent higher after previous sell-off
 (Recasts, updates comments, closing prices, adds second
byline, dateline)
                                
 By Frank Tang and Jan Harvey
                                
 NEW YORK/LONDON, Feb 12 (Reuters) - Gold dropped on Friday
on a dollar rally as worries for debt-stricken Greece and a
surprise move by China to tighten money supply took a toll on
sentiment.
                                
 For the week, the precious metal was 2 percent higher,
partially recovering from a two-day sell-off late last week
driven by technical weakness and heightened fiscal fears for
some European countries.
                                
 James Steel, chief commodities analyst at HSBC in New York,
said gold held up relatively well against strong headwinds, and
that the metal was poised to rise above $1,100 an ounce next
week.
                                
 "The gold market has been hit by some very negative news --
the Chinese monetary tightening and further unwinding of the
carry trade related to uncertainty over Greece," Steel said.
                                
 Spot gold <XAU=> was at $1,092.10 an ounce at 3:27 p.m. EST
(2027 GMT) against $1,095.85 late in New York on Thursday.
                                
 U.S. gold futures for April delivery <GCJ7> on the COMEX
division of the New York Mercantile Exchange settled $4.70 down
at $1,090 an ounce.
                                
 China raised the level of reserves banks must hold for the
second time this year, spooking global financial markets
because of suggestions it may be reigning in demand.
[
                                
 The euro fell sharply against the dollar on Friday as
questions persisted about a rescue deal for Greece. [USD/','yes')">ID:nTOE61B069

                                
 Michael Widmer, an analyst at Bank of America-Merrill Lynch
in London, said gold was coming under pressure as the dollar
appreciated broadly in reaction to the China news.
                                
 "We always see that when the markets sell off on the back
of a macro event, gold sells off along with those," he said.
                                
 The euro fell sharply against the dollar on Friday as
questions persisted about a rescue deal for Greece. [USD/].
                                
 Strength in the U.S. unit curbs gold's appeal as an
alternative asset and makes dollar-priced commodities more
expensive for holders of other currencies.
                                
 Other commodities also declined, with oil tumbling 1.5
percent to $74 a barrel, and base metals copper and zinc also
falling sharply. [O/R] [MET/L]
                                
 EURO-PRICED GOLD IN FOCUS
                                
 Gold priced in euros <XAUEUR=R> performed particularly well
on Thursday, rising 2.8 percent to a peak of 802.73 euros an
ounce, within 10 euros of the record high it hit in December.
                                
 The metal eased on Friday to 802.01 euros an ounce from
799.49 late in the last session, but from a technical viewpoint
it is well positioned to make fresh gains, analysts said.
                                
 "Since early December, gold denominated in euros has been
locked in a well-defined contracting range," said technical
analysts at Barclays Capital. "Now that range is on the verge
of giving way for a resumption of the larger bull trend."
                                
 On the supply side, the head of the Russian Gold
Industrialists' Union lobby group said Russia may lift gold
output to 207 tonnes this year from 205 tonnes in 2009, with
mine output rising 5 tonnes to 183 tonnes. [ID:nLDE61B0KM]
                                
 Among other precious metals, silver <XAG=> was at $15.48 an
ounce against $15.64. Platinum <XPT=> was at $1,512.50 an ounce
against $1,528 and palladium <XPD=> at $414.50 against
$419.50.
 (Reporting by Frank Tang and Jan Harvey in London; Editing by
Carole Vaporean)
                                
                     Close  Change   Pct    2009     YTD
                                
                                     Chg   Close   % Chg
US gold      <GCJ0>    1090.00    -4.7  -0.4 1096.20    -0.6
US silver    <SIH0>     15.447  -0.143  -0.9  16.845    -8.3
US platinum  <PLJ0>    1511.10   -8.20  -0.5 1471.00     2.7
US palladium <PAH0>     418.15   -0.80  -0.2  408.85     2.3
Prices at 3:36 p.m. EST (2036 GMT)
Gold         <XAU=>    1091.80   -4.05  -0.4 1096.35    -0.4
Silver       <XAG=>      15.48   -0.16  -1.0   16.84    -8.1
Platinum     <XPT=>    1509.00  -19.00  -1.2 1465.50     3.0
Palladium    <XPD=>     414.50  -5.000  -1.2  405.50     2.2
Gold Fix     <XAUFIX=> 1082.00    3.75   0.3    1104    -2.0
Silver Fix   <XAGFIX=>   15.33   -4.00  -0.3   16.99    -9.8
Platinum Fix <XPTFIX=> 1505.00    8.00   0.5    1466     2.7
Palladium Fix<XPDFIX=>  416.00    2.00   0.5     402     3.5