* Dollar slips to one-month low versus the euro
* Oil prices climb towards $83 a barrel
* Coming up: U.S. retail sales data at 1330 GMT
(Updates prices, adds comment)
By Jan Harvey
LONDON, March 12 (Reuters) - Gold rose towards $1,120 an
ounce in Europe on Friday as the dollar hit a one-month low
against the euro, helping the metal recover from the two-week
low it hit in the previous session.
Traders are awaiting fresh direction from U.S. retail sales
data for February, a key measure of consumer optimism in the
world's largest economy. This is likely to affect the dollar,
and consequently gold.
Spot gold <XAU=> was bid at $1,117.15 an ounce at 1303 GMT,
against $1,109.30 late in New York on Thursday. U.S. gold
futures for April delivery <GCJ0> on the COMEX division of the
New York Mercantile Exchange rose $9.00 to $1,117.20 an ounce.
"Today's firmer tone has largely been driven by the stronger
euro and weaker dollar, and we are clustered around an area of
reasonably decent support levels on the chart," said RBS Global
Banking & Markets analyst Daniel Major.
From a technical perspective, gold has key support at $1,115
and $1,104, analysts said, as well as the psychologically
important $1,100 level at which it bounced on Thursday.
However, the technical picture overall remains neutral, they
added. "Only a close back above $1,131 would inspire renewed
calls for higher prices," said ScotiaMocatta in a note.
The euro rose to a one-month high against the dollar on
Friday as traders covered short positions and the U.S. unit fell
on reports a policy dove was a leading candidate for vice chair
of the U.S. Federal Reserve. []
Weakness in the dollar boosts gold's appeal as an
alternative asset and makes dollar-priced commodities cheaper
for holders of other currencies.
Economists surveyed by Reuters expect a 0.2 percent decline
in sales compared with a 0.5 percent increase in January.
European shares rose ahead of the data. []
OIL CLIMBS
Oil rose towards $83 a barrel on Friday, poised for a second
consecutive weekly increase, amid expectations energy demand
would continue to grow despite any efforts by China to tighten
monetary policy further on rising inflation. []
Gold tends to track crude prices, as the metal can be bought
as a hedge against oil-led inflation.
Demand for the exchange-traded funds backed by the precious
metal was soft, with holdings of the world's largest gold ETF,
New York's SPDR Gold Trust <GLD>, unchanged on Thursday from a
day before. []
However, investment in U.S. gold futures remains firm,
analysts said. "There is a reported build-up of long positions
in New York futures," said Fairfax analyst John Meyer in a note.
Among other precious metals, silver <XAG=> was bid at $17.28
an ounce against $17.16, tracking gains in gold.
The world's largest silver-backed ETF, the iShares Silver
Trust <SLV>, said its holdings fell 48.82 tonnes from the
previous day to 9,302.58 tonnes on Thursday. []
Elsewhere platinum <XPT=> hit a seven-week high $1,623.50 an
ounce and was later bid at $1,620 against $1,609.50, while
palladium <XPD=> was at $463 against $458.
The metals have performed well this year as investors expect
industrial demand from carmakers to improve and investment
buying to rise. They are also closely eyeing supply of metals.
Among the minor precious metals, iridium <IRID-LON> rose to
a 12-year high on Friday, with traders reporting strong Asian
demand for the metal used in chemicals processing and
manufacturing electronics components. []
"There seem to be many enquiries from Asian countries," said
one trader of the minor metal.
(Editing by James Jukwey)
