* Platinum falls 5 pct on fears over automotive sector
* Gold slips as oil falls
* Dollar firms after higher than expected inflation reading
(Updates platinum, gold)
By Jan Harvey
LONDON, Aug 4 (Reuters) - Platinum fell another 5 percent to
a new six-month low on Monday and could fall further in the
short term as investors worry about the outlook for the car
industry after monthly U.S. car sales slipped to a 16-year low.
Around half of global platinum supply is used by the
automotive industry in catalytic converters, so any slowdown in
car manufacturing could have a major impact on demand.
Spot platinum <XPT=> fell to $1,578.00/1,598/00 an ounce at
1307 GMT, having touched a session low of $1,563.50, its lowest
since January 24, from $1,646.50/1,666.50 an ounce late in New
York on Friday.
Prices are down about 30 percent since a record high of
$2,290 in early March.
Sister metal palladium <XPD=> was down at $358.50/362.50 an
ounce from $364.00/372.00 late in New York.
"Short term risk is to the downside, on poor numbers and
reports from the car sector and slowing demand from this
segment," said Commerzbank analyst Eugen Weinberg.
"The picture has changed completely (for platinum), from
fears over supply shortages (to worries) over slowing demand,"
he added.
In Asia on Monday, the most active contract on Tokyo
platinum futures <0#JPL:> slid by its daily 300-yen limit to its
weakest since late January as speculators sold their contracts.
Investors are worried about a slowdown in the car industry
after U.S. car sales slipped to a 16-year low in July, led by a
27 percent drop at General Motors Corp <GM.N>. []
Investment demand for platinum also appears softer.
London-based ETF Securities said its Physical Platinum ETF
<PHPT.L> has seen outflows of over 42,000 ounces, or 11 percent,
over the last month.
Earlier this year platinum spiked up to an all-time high of
$2,290 an ounce on fears a power shortage in major producer
South Africa could seriously deepen the metal's supply deficit
this year.
GOLD REBOUNDS
Gold slipped alongside crude prices. The precious metal is
used by investors as a hedge against inflation, often triggered
by rising oil prices.
Oil reversed the gains it posted earlier in the session to
fall below $124 a barrel, pressured by evidence of rising OPEC
output. []
The dollar meanwhile firmed against the euro, further
pressuring gold, after a report showed a higher-than-expected
reading on a key U.S. inflation measure for June.
[]
The precious metal typically moves in the opposite direction
to the U.S. currency, as it is often bought as a hedge against
dollar weakness.
The market will be looking to a spate of central bank
meetings this week, including Federal Reserve talks on Tuesday,
to lend fresh direction to the foreign exchange markets.
In investment news, gold holdings of the world's largest
gold-backed exchange traded fund, the SPDR Gold Trust <GLD>,
edged up 0.1 percent to 674.02 tonnes on Friday, the trust said.
Spot gold <XAG=> fell to $904.65/905.85 an ounce from
$909.85/911.45 late in New York on Friday.
Among other precious metals, spot silver <XAG=> edged up to
$17.27/17.33 an ounce from $17.47/17.55 late in New York.
(Additional reporting by Pratima Desai)
(Reporting by Jan Harvey; Editing by Peter Blackburn)
