* Demand for gold as a haven diminishes
* Dollar lifts from lows, undermines support for bullion
(Updates prices)
By Jan Harvey
LONDON, May 11 (Reuters) - Gold dipped in Europe on Monday
as returning risk appetite boosted the appeal of assets such as
stocks and higher-yielding currencies, denting interest in
bullion as a haven.
A weaker dollar limited losses in the precious metal,
analysts said, although the U.S. currency's move off lows has
undermined some support.
Spot gold <XAU=> was bid at $911.45 an ounce at 1150 GMT,
against $916.05 an ounce late in New York on Friday.
Commerzbank analyst Eugen Weinberg said investors are
increasingly turning towards assets seen as riskier, such as
stocks. "Gold is a safe haven, and you don't need to be safe at
the moment," he said.
"Investment demand, which has been by far the most important
guiding factor behind gold prices, is disappearing, so prices
could correct," he added.
Nonetheless, fears over the inflation outlook and the
prospect of a weaker dollar will still lend support to the gold
market, he said.
Equities were slightly weaker in Europe, but Asian shares
rose to their highest in seven months as traders focused on the
message of U.S. payrolls data released on Friday, which showed
the economy shed fewer jobs than expected. []
China added to positive news on Monday, as deputy Central
Bank governor Su Ning told a conference the government's
stimulus had worked better than expected. []
On the foreign exchange markets, the dollar fell to its
lowest in seven weeks versus the euro. []
The U.S. currency's falls have supported gold, which is
often bought as an alternative asset to the dollar, though the
metal gave up some ground as the dollar lifted from lows.
TRICKLE
Investment in gold-backed exchange-traded funds remained
lacklustre last week.
Holdings of the world's largest, the SPDR Gold Trust <GLD>,
edged down 0.36 tonnes in the week to May 8 to 1,104.09 tonnes,
while those of the three gold ETFs operated by London's ETF
Securities were little changed. [] []
Gold demand from India, the world's biggest bullion buyer,
also slowed to a trickle on Monday, dealers said.[]
Spot silver <XAG=> eased to $13.76 an ounce against $13.98,
tracking gold. Holdings of Zurich Cantonal Bank's silver ETF
rose nearly 600,000 ounces last week, it said, while its gold
holdings were little changed. []
Among other precious metals, spot platinum <XPT=> was bid at
$1,129.50 an ounce against $1,145.50, while spot palladium
<XPD=> was bid at $235 an ounce against $238.50.
ETF Securities said holdings of its platinum-backed
exchange-traded commodities fell 5.7 percent last week or just
over 19,000 ounces.
Buying precious metals to back ETFs has been a significant
source of demand for gold and silver in recent years, and is
increasingly important for platinum and palladium.
Lonmin <LMI.L>, the world's third-biggest platinum producer,
unveiled a $457 million rights issue on Monday to cut its debt.
It swung to a loss and scrapped its dividend in the first half
after metals prices fell. []
Investec said the company's guidance was downbeat, with
management saying it is "not planning for any significant
recovery in platinum group metals prices in the next 12 months".
(Reporting by Jan Harvey; Editing by Sue Thomas)
