* Dollar slips after gains; euro recovers losses
* Oil prices rise towards $70/oz
* Silver climbs more than 2 percent, boosted by gold
(Releads, updates prices)
By Jan Harvey
LONDON, June 9 (Reuters) - Gold climbed back above $960 an
ounce on Tuesday and silver rose more than 2 percent as a fall
in the dollar versus the euro boosted interest in the precious
metals.
Spot gold <XAU=> was bid at $959.30 an ounce at 1325 GMT,
against $950.05 an ounce late in New York on Monday, having
earlier touched a high of $961.60. Silver <XAG=> was at $15.26
an ounce, up 2 percent from $14.91.
U.S. gold futures for June delivery <GCM9> on the COMEX
division of the New York Mercantile Exchange rose $10.80 to
$962.50 an ounce.
The dollar fell as stock futures rose and investors
questioned whether the U.S. economy is strong enough to justify
higher interest rates by the year-end, with the euro breaking
through $1.40. []
"In terms of direction, the dollar is very, very important
to gold, and it is difficult to see that changing," said
Citigroup analyst David Thurtell.
Gold is often bought as a hedge against currency weakness,
and all dollar-priced commodities become cheaper for holders of
other currencies as the U.S. unit loses value.
The metal is likely to spend some time consolidating above
$950 an ounce after sliding 3 percent in the last two sessions,
but underlying interest in gold as a hedge against currency
weakness and prospective inflation remains firm, analysts said.
A clearing out of weak long positions -- speculative
positions on New York's COMEX exchange -- from the gold market
has given it a stronger base for gains, Gerry Schubert, head of
precious metals at INTL Commodities, said.
"The most important point is that we have seen some long
liquidation that we needed to see," he said. "The whole picture
looks a lot healthier than it looked five, six days ago."
FIRMER CRUDE
On other markets, oil rose on Tuesday towards $70 a barrel.
Firmer crude prices often help gold, which can be bought as a
hedge against oil-led inflation. []
Buoyant commodity prices helped lift European shares, while
U.S. stock index futures also pointed to a higher open.
[]
Physical demand remained relatively quiet, with the market
dominated by investment buying. In India, the world's largest
bullion market, high prices kept traders on the sidelines as the
wedding season approached its end.
Among other precious metals, platinum <XPT=> was at $1,247
an ounce against $1,242, while palladium <XPD=> was at $251.50
against $247.50.
Mitsubishi precious metals strategist Tom Kendall said with
no underlying fundamental reason for platinum to make fresh
gains, it is likely to reflect dollar moves.
"I would expect prices to stall around here and then drift
lower," he said. "But if the dollar is going to sell off again
then in dollar terms, prices will naturally move higher."
ETF Securities said holdings of its ETFS Physical Platinum
exchange-traded fund <PHPT.L> rose nearly 16,000 ounces or 5.1
percent on Monday, suggesting firm investor interest in the
metal. []
(Additional reporting by Kylie Maclellan; Editing by
William Hardy)
