UPDATE 5-Gold cuts loss as dollar slips, oil weighs

                                
 * Gold pares loss as dollar erases gains, oil pressures
                                
 * Platinum, palladium slip on demand fears
                                
 * Turkey's H1 gold imports dip 27.5 pct
 (Reledes with late price action; updates with New York prices,
adds New York comment)
                                
 By Jan Harvey and Carole Vaporean
                                
 LONDON/NEW YORK, July 7 (Reuters) - Gold prices slipped
along with oil on Monday in response to a rising dollar, but
the yellow metal later trimmed those declines when the U.S.
currency erased its gains on the euro, traders said.
                                
 The dollar retreated when U.S. equity markets extended
their losses, amid falling energy shares and renewed credit
market concerns, dollar traders said. [nN07427456]
                                
 Gold <XAU=> pulled off early lows to $925.20/926.80 an
ounce by 4:00 p.m. EDT (2000 GMT) though was still lower than
$932.00/933.00 an ounce in London on Friday, when U.S. markets
were closed for Independence Day holiday.
                                
 Earlier, it touched a session low of $914.50 an ounce,
nearly 2 percent below the level it traded at on Friday.
                                
 "The euro is a bit weaker, the dollar is stronger and oil
is slipping a bit," said Commerzbank analyst Eugen Weinberg.
                                
 "There has been a strong negative correlation between the
gold price and the equity markets. Risk aversion has led to an
inflow into gold, so higher equity markets could see a lower
gold price."
                                
 A falling dollar typically aides gold, which is bought as
an alternative investment to the U.S. currency. A weaker
greenback also makes dollar-priced commodities such as precious
metals less expensive for holders of other currencies.
                                
 In New York, the August gold contract <GCQ8> finished $4.80
lower at $928.80 an ounce on the COMEX division of New York
Mercantile Exchange after falling as low as $916.30.
                                
 "The dollar's firmness capped gold and silver's rally for
the short term. With today's price action, as long as gold can
hold above $916 (an ounce) we should continue to consolidate
last week's spike higher to build for a rally," said
HeritageWestFutures.com futures analyst Ralph Preston.
                                
 OIL SLIPS
                                
 Lower oil prices kept downward pressure on gold, which is
often bought as a hedge against oil-led inflation.
                                
 Crude fell over $4 a barrel on profit taking and signs that
Iran will be more flexible in negotiations over its nuclear
program. [OIL/]
                                
 However, in the longer run near-record crude prices are
seen as a major supportive factor for the precious metal.
                                
 "Oil prices at these levels should anchor precious metal
investment demand as investors seek portfolio protection
against rising global inflation expectations," said Standard
Bank analyst Manqoba Madinane in a note.
                                
 In fundamental news, London-based ETF Securities said the
amount of gold it holds to back its Physical Gold
exchange-traded fund has risen 15 percent in the last week to a
record 1.459 million ounces.
                                
 The rise reflected gains across its physically backed
precious metals ETFs, with its platinum and palladium holdings
also rising to new records and silver ticking up 1 percent.
[ID:nL07735199]
                                
 However, jewellery buying remains lacklustre as prices
remain high and volatile, analysts said.
                                
 Turkey's gold imports were down 27.5 percent year-on-year
in the first half of 2008. The country was the fifth largest
gold jewellery buying area last year, according to the World
Gold Council. [ID:nL07113142]
                                
 Platinum group metals prices also slid, with platinum
shedding 1.5 percent to a one-month low and palladium just
under 1 percent weaker, as investors took profits after the
metals' recent gains, amid fears demand may slacken.
                                
 Platinum is chiefly used to make autocatalysts. Investors
fear that falling car sales could hit PGM consumption, as the
U.S. economy falters.
                                
 Spot platinum <XPT=> was trading at $1,963.00/1,983.00, its
weakest level since June 5, down from $1,999.00/2,019.00 in
London on Friday.
                                
 Platinum has lost 13 percent in value since hitting a
record of $2,290 in March. The metal, also used in jewellery,
had rallied after a power crisis in main producer South Africa
disrupted mining and sparked fears of a supply deficit.
                                
 Spot palladium <XPD=> slipped to $442.50/450.50 an ounce
from $450.00/455.00 an ounce, while silver <XAG=> dropped to
$17.57/17.62 an ounce from $18.02/18.12 late in London -- well
below an 11-week high of $18.46 hit last week.
 (Editing by Christian Wiessner)