* Dollar firms after ECB opts to keep rates on hold
* U.S. non-farm payrolls also in focus
* SPDR ETF dips; ETFS silver, palladium assets hit records
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By Jan Harvey
LONDON, June 4 (Reuters) - Gold steadied on Thursday after
the firmer dollar briefly pushed it lower in the wake of the
European Central Bank's decision to hold interest rates, as
traders awaited comments from ECB chief Jean-Claude Trichet.
Spot gold <XAU=> was bid at $964.60 an ounce at 1322 GMT,
versus $962.15 an ounce late in New York on Wednesday. U.S. gold
futures for June delivery <GCM9> on the COMEX division of the
New York Mercantile Exchange fell 20 cents to $964.30 an ounce.
The dollar firmed against the euro after the ECB kept its
main refi rate at a record low 1.0 percent. The markets are now
turning their attention to details of the bank's bond purchase
plan and any clues on whether rates would be cut further. []
"All gold's forward movements will definitely depend upon
the euro-dollar direction in the immediate term," said Pradeep
Unni, senior analyst at Richcomm Global Services.
Any new dollar weakness could prompt more buying of gold as
an alternative asset, and will make dollar-priced commodities
cheaper for holders of other currencies.
"We would expect gold's inverse correlation to the dollar to
remain strong, while its correlation to the stock markets will
start weakening from now on," VTB Capital said in a note.
European shares turned negative in the wake of the ECB
decision, having earlier risen close to 2009 highs on Thursday.
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The market also looked ahead to U.S. non-farm payrolls data
on Friday for its impact on the currency markets.
"If this comes in lower than expectations, I expect we will
see some downward pressure on gold," said David Wilson, a metals
analyst at Societe Generale.
INVESTMENT DEMAND
On the investment side, holdings of the world's largest
gold-backed exchange-traded fund, New York's SPDR Gold Trust,
posted a small 1.5-tonne fall on Wednesday. []
The three gold-backed ETFs operated by London's ETF
Securities added 36,655 ounces of bullion to their reserves that
session. But gold demand from India, the world's biggest bullion
consumer, was sluggish as prices stayed high. []
Silver <XAG=> was $15.12 an ounce against $15.30, tracking
moves in the gold market.
Platinum <XPT=> was at $1,238.50 an ounce versus $1,233.50,
while palladium <XPD=> was $243 against $240.50, both benefiting
from fund buying. ETF Securities said its silver and palladium
ETFs both hit record levels on Wednesday. []
Platinum refiner Johnson Matthey warned its profits and
sales would fall over the coming months as the world car
industry continued to struggle. []
Goldman Sachs, however, said U.S. auto sales were likely to
improve in the second half of 2009. []
(Editing by William Hardy)
