* Dollar strengthens after well-received U.S. data
* Concern over outlook for Greece persists in euro zone
* PGMs traders digest 20 pct rise in U.S. auto sales
(Updates, adds comment, changes dateline from SYDNEY)
By Jan Harvey
LONDON, May 4 (Reuters) - Gold eased in Europe on Tuesday as
the dollar strengthened against a basket of currencies <.DXY>,
but remained supported near $1,180 an ounce as persistent fears
over euro zone debt prompted buying of the metal as a haven.
Spot gold <XAU=> was bid at $1,178.15 an ounce at 0758 GMT,
against $1,181.40 late in New York on Monday. U.S. gold futures
for June delivery <GCM0> on the COMEX division of the New York
Mercantile Exchange eased $4.30 to $1,179.00 an ounce.
The precious metal hit a high of $1,187.41 an ounce on
Monday, its strongest since early December, as investors
remained sceptical an aid package for Greece will succeed in
resolving its sovereign debt problems.
"The market still has doubts that Greece will (succeed) in
implementing further measures agreed with the IMF, and also that
the support package will pass the German lower and upper
houses," said Peter Fertig, a consultant with Quantitative
Commodity Research.
European finance ministers triggered a record 110 billion
euro bailout for debt-stricken Greece on Sunday after Athens
committed itself to years of painful austerity. []
But doubts remain whether Greece will be able to carry out
its promised tough austerity measures, the package still needs
parliamentary approvals and leaves open the question of whether
other vulnerable European countries might also need help.
A German government source said Greece's capital
requirements until 2012 are greater than the 110 billion euros
included in a euro zone and IMF rescue package. []
"The reaction to the... Greek bailout package and the ECB's
suspension of collateral rules on Greek debt can be described as
lukewarm at best," said Credit Agricole in a note. "Greek and
peripheral bond yield spreads narrowed but the euro slipped."
"Concerns about parliamentary approvals,
implementation/execution risk, prospects for relatively weaker
growth in Europe, as well as contagion to Spain and Portugal,
has tempered any enthusiasm towards the package."
DOLLAR WEIGHS
While these concerns lifted interest in gold as a haven from
sovereign risk, gains in the dollar pressured it from the $1,180
an ounce mark. The dollar rose 0.2 percent versus the euro as
concern grew over whether the aid package will work. []
The dollar also gained against a basket of six currencies
after U.S. data showed factories running at their fastest pace
in nearly six years on Monday.
Strength in the dollar typically curbs gold's appeal as an
alternative asset and makes dollar-priced commodities more
expensive for holders of other currencies.
Among other commodities, oil prices fell below $86 a barrel
as the dollar strengthened and ahead of an expected rise in U.S.
crude and fuel stocks. Prices hit 19-month highs on Monday after
well-received U.S. economic data. []
Silver prices <XAG=> were at $18.64 an ounce against $18.77,
tracking losses in gold. Platinum <XPT=> was at $1,718.50 an
ounce against $1,720, while palladium <XPD=> was at $535.50
against $539.
The platinum group metals are particularly exposed to the
recovery in the global automobile sector, as carmakers account
for more than half of demand for the autocatalyst materials.
Data showed U.S. auto sales rose about 20 percent in April
from recession-stunted results a year earlier, reflecting a
still-gradual recovery in the economy. The figures were not as
robust as some had hoped. []
(Reporting by Jan Harvey; Editing by William Hardy)
