* Dollar firm after jobless, durable goods, consumption data
* Euro zone debt concerns set to simmer into new year
* SPDR gold ETF sees biggest one-day outflow since early Oct
(Updates prices, adds comment)
By Jan Harvey
LONDON, Dec 23 (Reuters) - Gold slipped nearly 1 percent to
a session low at $1,372.50 an ounce on Thursday, erasing most of
this week's gains, as the dollar held firm against the euro
after a raft of U.S. data.
Spot gold <XAU=> was bid at $1,373.00 an ounce at 1450 GMT,
against $1,384.55 late in New York on Wednesday. U.S. gold
futures for February delivery <GCG1> fell $13.40 to $1,373.90.
U.S. data showed first-time claims for jobless benefits
barely moved last week, suggesting the labour market is healing
too slowly to cut unemployment. []
Other reports showed U.S. consumer spending rose for a fifth
month in November and incomes climbed by more than expected,
while a rise in new orders for U.S. manufactured goods excluding
transport also beat expectations. [] []
The dollar held onto its earlier gains versus the euro after
the data, pushing gold lower. Dollar strength typically curbs
gold's appeal as an alternative asset and makes dollar-priced
assets more expensive for holders of other currencies. []
That correlation weakened this year as concerns over euro
zone sovereign debt levels lifted both assets, but the dollar's
performance next year will remain key to developments in the
gold price, analysts said.
"This year it's been a mixed bag with gold trading inversely
to the U.S. dollar," said Jeff Pritchard, an analyst and broker
at Altavest Worldwide Trading.
"But as the U.S. debt becomes more and more of a focus, as
it has to at some point...there is going to be more and more
uncertainty in the U.S. dollar. That will drive people into
other assets, and gold will definitely be one of them."
HEADING FOR WEEKLY RISE
Thursday's correction notwithstanding, gold is still heading
for its first weekly rise in three. Its haven appeal rose after
ratings agency Fitch said it may cut Greece's foreign currency
rating and Moody's threatened to downgrade debt-ridden Portugal.
"The prospect of further downgrades had an impact on the
euro and (also) on gold," said Peter Fertig, a consultant at
Quantitative Commodity Research.
"This is probably calming down in the final few trading days
of this year, but it will remain a topic going into next year.
From that perspective, gold seems to be well supported."
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For interactive graphics on the euro zone debt crisis:
http://r.reuters.com/hyb65p
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Analysts say gold and the other precious metals could be in
for some hefty gains next year.
While the prospect of tighter monetary policy, initially in
China, could be a threat to the metals, persistent concern over
sovereign debt is likely to benefit gold, while more industrial
precious metals will be supported by economic recovery.
"There are a number of risks clouding the outlook for 2011,
including the threat to growth from the transition to tighter
liquidity conditions in China and uncertainty over the extent to
which sovereign debt contagion will affect other European
countries," said Barclays Capital in a report.
"However, we expect an environment of sustained economic
recovery, more supportive financial market sentiment and
exceptionally easy monetary policy to provide a fertile ground
for price gains early next year."
The world's largest gold-backed exchange-traded fund, New
York's SPDR Gold Trust <GLD>, recorded its biggest one-day drop
since early October on Wednesday, with its holdings declining
just over 9 tonnes to 1,288.616 tonnes. []
The fund's holdings are up just over 2 tonnes since the end
of November, against a rise of nearly 16 tonnes in the same
period of last year.
Among other precious metals, platinum <XPT=> was at
$1,711.99 an ounce against $1,721.50, while palladium <XPD=> was
at $744.97 against $748.25. Silver <XAG=> was at $29.03 an ounce
against $29.20.
(Editing by Sue Thomas)
