* Gold hits fresh record high, topping $1,185 an ounce
* US dollar index <.DXY> at 15-month lows
* U.S. stocks boosted by upbeat U.S. data ahead of holiday
* European shares close higher on data
(Updates with U.S. markets, data, new dateline, byline)
By Daniel Bases
NEW YORK, Nov 25 (Reuters) - Gold investors gave thanks on
Wednesday for another record high, while the dollar laid an egg,
dropping to a fresh 15-month low against a basket of currencies after
a batch of U.S. economic data suggested a recovery was gaining
traction.
The data helped lift U.S. and European shares while driving
government bond markets down. Japanese stocks rose in volatile
trade.
The dollar's drop ahead of Thursday's U.S. Thanksgiving Day
holiday was not simply due to investors extending risk in reaction to
falling weekly U.S. jobless claims as well as a rise in both consumer
spending and sales of new homes. For details, see []
Also playing a role in the greenback's fall was the U.S. Federal
Reserve's release of minutes Tuesday that voiced increased confidence
in the U.S. economic recovery and Russia's announcement it would
diversify some foreign exchange reserves into Canadian dollars.
[] []
Investors shrugged off an unexpected decline in durable goods
orders, a leading indicator of manufacturing activity.
A published report that India's central bank was interested in
buying more gold beyond the 200 tonnes it purchased earlier this
month from the International Monetary Fund also gave a strong bid to
the precious metal. The IMF had no comment.
"Most commodities are rallying on the back of the weaker dollar,
and that move is potentially quite significant," said Standard
Chartered analyst Daniel Smith in London.
"Gold has been outperforming on the back of this general rally in
commodities, and that tells us that there is more to this than just
the dollar story," he said.
Spot gold shot to a record high of $1,185.70 before easing to
$1,184.10. Silver was on track to close at a 16-month high, near
$18.71 <XAG=>, up 1.2 percent.
The U.S. dollar index <.DXY> fell 0.7 percent at 74.547, while
the euro rose about 1 percent at $1.5079 <EUR=>, a 15-month high. The
greenback <JPY=> fell 1 percent at 87.68 yen, a 10-month low against
the Japanese currency.
In addition to saying it has increased confidence in the
sustainability of the U.S. economic recovery, the Fed also said the
decline in the U.S. dollar has been "orderly."
"When the Fed says the dollar's decline has been 'orderly' ...
they're implicitly saying this is not something they will do anything
about," said Johan Javeus, chief currency strategist at SEB in
Stockholm.
Dubai's government helped put the brakes on the dollar's slide
after it said it will ask creditors of its two flagship firms for a
standstill on debt worth billions of dollars as a first step toward
restructuring Dubai World, a conglomerate that spearheaded the
emirates' breakneck growth.
"The Dubai news was a surprise and helped halt the rally in the
euro against the dollar as traders took some of their risky assets
off the table," said Steven Butler, director of FX trading at Scotia
Capital in Toronto.
U.S. stocks were modestly higher at 1 p.m. EST (1800 GMT). The
Dow Jones industrial average <> was up 17.31 points, or 0.17
percent, at 10,451.02. The Standard & Poor's 500 Index <.SPX> added
2.80 points, or 0.25 percent, at 1,108.45. The Nasdaq Composite Index
<> rose 5.07 points, or 0.23 percent, at 2,174.25.
MSCI's all-country world equities index <.MIWD00000PUS> rose
nearly 1 percent, while European shares <> added 0.5
percent. Japan's Nikkei 225 index <> gained 0.4 percent. MSCI's
emerging markets stock index rose 0.7 percent <.MSCIEF>.
U.S. light sweet crude oil <CLc1> increased 2 percent to $77.51
per barrel.
Benchmark 10-year U.S. Treasuries <US10YT=RR> rose 5/32 of a
point in price, moving the yield to 3.288 percent, after a strong
auction of $32 billion of seven-year notes.
Yields on the euro zone's benchmark bonds, which trade inversely
to prices, were flat to modestly higher across the curve with the
two-year yield <EU2YT=RR> barely changed on the day at 1.335 percent
and the 10-year yield <EU10YT=RR> up 2 bps at 3.262 percent.
(Additional reporting by Reuters correspondents worldwide;
editing by Jeffrey Benkoe)
((daniel.bases@thomsonreuters.com; +1 646 223 6131; Reuters
Messaging: daniel.bases.reuters.com@reuters.net))
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