* Spot gold holds steady just above $950 an ounce
* Consolidation continues from 11-month high last week
* Dollar hits 3-month high vs yen, some risk appetite
returns
(Releads, updates prices)
By Chikako Mogi
TOKYO, Feb 26 (Reuters) - Gold eased a touch as the dollar
held onto gains against the yen on Thursday, as investors took
profit from an 11-month high hit last week and awaited fresh
news before buying again.
The market has become more volatile after prices rose above
the key $1,000 level last week, and though factors encouraging
risk aversion remain, investors are choosing to cash in on the
high prices now rather than chase them higher.
The gold market took its cue from the dollar's strength as
it hit a three-month high against the yen, with market
sentiment improving somewhat after comments earlier in the week
by Federal Reserve Chairman Ben Bernake and U.S. President
Obama, traders said.
Spot gold <XAU=> was trading at $945.60 an ounce as of 0620
GMT, down 0.7 percent from the notional close of $952.10 on
Wednesday. Gold fell 4 percent over the previous three
sessions.
"The dollar is firmer after Bernanke and Obama's comments
eased some concerns about the economic outlook, helping some
risk appetite to leave from the gold market," said a dealer at
a European securities firm in Tokyo.
The yen tumbled also on concerns about Japan's economic
outlook. []
Gold typically moves in the opposite direction to the U.S.
dollar, and is often bought as an alternative asset.
However, the two have moved in line in recent weeks as both
have benefited from a flight to safety among investors. Gold
gains when risk aversion is high as it is seen as a safe store
of value for investors.
Traders said although light buying had aided prices, given
talk of the global recession, some people may opt to sell gold
to secure cash, causing the market to lack the momentum to push
beyond $1,000 in the near term.
"Gold prices are still high. Some people may be
capitalising on high prices," said Beh Hsia Wah, a dealer at
United Overseas Bank in Singapore.
"Gold is seen as a safe haven, and overall the market is
still bullish. But it's very hard to predict market direction
because it's driven by psychological buying and selling," she
said.
The world's largest gold-backed exchange-traded fund, the
SPDR Gold Trust <GLD>, said its holdings remained at a record
high of 1,028.98 tonnes on Feb. 25, a level it first hit on
Feb. 19. [], suggesting that growing demand for gold to
back ETFs may have stalled.
Precious metals prices at 0625 GMT
Metal Last Change Pct chg YTD pct chg
Turnover
Spot Gold 945.35 -6.75 -0.71 7.41
Spot Silver 13.56 -0.13 -0.95 19.79
Spot Platinum 1044.00 0.00 +0.00 12.02
Spot Palladium 195.00 -0.50 -0.26 5.69
TOCOM Gold 2985.00 1.00 +0.03 16.01 51525
TOCOM Platinum 3276.00 34.00 +1.05 23.53 7710
TOCOM Silver 421.30 -1.20 -0.28 31.94 396
TOCOM Palladium 622.00 -9.00 -1.43 13.09 381
Euro/Dollar 1.2705
Dollar/Yen 97.82
TOCOM prices in yen per gram, except TOCOM silver which is
priced in yen per 10 grams. Spot prices in $ per ounce.
(Additional reporting by Risa Maeda; Editing by Ben Tan)
