* Gold weaker on China monetary policy, easing Greek woes
* Concerns that China may invest less in gold weigh
* Signs of Wall Street rebound also drive down bullion
* Coming up: US personal income, Core PCE index; 1230 GMT
(Updates prices)
By James Regan
SYDNEY, May 3 (Reuters) - Gold was slightly weaker on
Monday, after a fresh 2010 high last week, as the latest move
by China to tighten money supply triggered demand worries and a
bailout package for debt-laden Greece eased safe haven
concerns.
"Gold kicked in as a safe-haven investment and that's where
those big gains came from," a bullion dealer in Sydney said.
"But that may have been a little overdone and now we're
seeing some selling into that," the dealer said.
"The fact that the Chinese may not have as much to put into
gold is also a negative."
Gold gained almost 6 percent in April, its biggest
one-month rise since November, as credit ratings downgrades of
Greece, Spain and Portugal unleashed a wave of risk aversion,
channeling money into gold.
China on Sunday raised the proportion of deposits that
lenders must keep in reserve, another step in its campaign to
mop up excess cash, this time draining about 300 billion yuan
($44 billion> from the banking system. []
The People's Bank of China said it was lifting lender
reserve requirement ratio by 50 basis points, effective May 10,
its third increase of that magnitude this year to cool down the
economy, which may impact sales of gold and related items like
jewellery.
China is the world's largest producer of gold and is set to
overtake India as the largest consumer. The China Gold
Association has estimated domestic gold demand grew 13.8
percent 450 tonnes in 2009.
Some indications that Wall Street will rebound later on
Monday after recording its worst week since January last week
and eroding the risk-aversion appeal of gold also weighed on
bullion prices, according to dealers.
U.S. stock futures <SPc1> were up 0.15 percent.
But markets could take a mixed view of an agreement on
Sunday by European finance ministers for a record 110 billion
euro ($147 billion) bailout for Greece after Athens committed
itself to years of painful austerity. []
New found U.S. dollar strength was also encouraging
investment selling, the dealers said.
The index of the dollar <.DXY> against six major currencies
was up 0.4 percent.
Spot gold <XAU=> was quoted at $1,177.00 an ounce at 0725
GMT after hitting a high of $1,181.05 an ounce on Friday before
recoiling to a nominal close of $1,178.55 an ounce.
U.S. June gold futures <GCM0> eased to $1,177.80 versus
Friday's close at $1,180.70 an ounce on the COMEX division of
the NY Mercantile Exchange.
Based on Reuters technical data, gold is on a bullish trend
towards $1,261 per ounce.[]
Gold got its lift on Friday as U.S. stocks tumbled to close
out the worst week since January as news of a criminal probe
into Goldman Sachs unnerved investors.
Silver <XAG=> stood at $18.53 an ounce versus $18.64 an
ounce Friday.
Platinum <XPT=> recoiled $9.50 from Friday's close to
$1,725.00 and palladium <XPD=> fell $7.50 to $541.50 an ounce.
Britain, Japan, China and Thailand are closed on Monday for
public holidays.
Precious metals prices at 0726 GMT
Metal Last Change Pct chg YTD pct chg
Turnover
Spot Gold 1177.18 -0.07 -0.01 41.37
Spot Silver 18.55 -0.04 -0.22 25.59
Spot Platinum 1725.00 -14.50 -0.83 13.49
Spot Palladium 541.50 -10.00 -1.81 47.15
TOCOM Gold 3581.00 26.00 +0.73 17.03
17217
TOCOM Platinum 5260.00 22.00 +0.42 -1.48
3844
TOCOM Silver 57.00 0.60 +1.06 -89.46
84
TOCOM Palladium 1664.00 -1.00 -0.06 23.17
138
Euro/Dollar 1.3223
Dollar/Yen 94.00
TOCOM prices in yen per gram, except TOCOM silver which is
priced in yen per 10 grams. Spot prices in $ per ounce
(Reporting by James Regan; Editing by Ed Lane)
