* Dollar recovers losses versus euro after U.S. data
* U.S. November retail sales rise more than expected
* Russia state repository to sell gold to cenbank-source
(Updates prices)
By Jan Harvey
LONDON, Dec 11 (Reuters) - Gold prices fell 1 percent to
four-week lows in Europe on Friday, giving up the gains which
earlier took them above $1,140 per ounce, as upbeat U.S.
economic data lifted the dollar.
Spot gold <XAU=> hit a low of $1,115.35 and was bid at
$1,119.90 an ounce at 1527 GMT, against $1,130.15 late in New
York on Thursday. Earlier it rose as high as $1,141.90 an ounce.
The dollar recouped its early decline to turn higher against
the euro midafternoon after data showed U.S. retail sales rose
more than expected in November, raising hopes of a
self-sustaining economic recovery. [] []
The currency extended gains after a survey showed U.S.
consumer sentiment improved in early December.
"We had very good numbers coming out, the dollar got a bit
of a boost on the back of this and gold lost a few dollars,"
said Afshin Nabavi, head of trading at MKS Finance in Geneva.
He said gold was likely to settle into a $1,100-1,160 range
until the end of the year ahead of further gains in early 2010.
"This may just be a correction in the dollar, as well as in
the metal," he said. "Come 2010, provided we have no further
surprises, I think we are more likely to see the higher end of
the market."
U.S. gold futures for February delivery <GCG0> on the COMEX
division of the New York Mercantile Exchange were down $5.20 to
$1,121.00, down from an earlier high of $1,143.40.
Among other commodities, oil prices also edged up 0.2
percent to near $71 a barrel. Gold tends to track crude prices,
as the metal can be bought as a hedge against oil-led inflation.
Elsewhere a source at the Russian state repository Gokhran
said on Friday it was likely to sell 30 tonnes of gold to the
country's central bank next week. Traders say central bank
interest in gold as a reserve asset is growing. []
CHINA OUTPUT CLIMBS
On the physical side of the market, premiums for gold bars
firmed in Asia after gold retreated from record highs, while
higher Indian jewellery during the wedding season helped offset
scrap sales from other Asian holders, dealers said. []
China's Ministry of Industry and Information Technology said
on Friday the country produced 26.354 tonnes of gold in October.
Gold output in the first 10 months rose 14.1 percent to 254.552
tonnes, it added. []
China is the world's main gold producer, and is set to take
over from India as the biggest bullion consumer this year as
well, according to the World Gold Council. []
Among other precious metals, silver <XAG=> was at $17.20 an
ounce against $17.37, platinum <XPT=> was at $1,416 an ounce
against $1,422 and palladium <XPD=> at $363.50 against $362.50.
James Moore, an analyst at TheBullionDesk.com, said he
expects to see further gains the platinum group metals.
"Further chart support around $1,390-1,410 and $353/358 is
expected in the coming sessions, with the longer-term outlook
still upbeat as recovering auto and industrial sales are set to
increase metal demand," he said.
ETF Securities said holdings of its ETFS Physical Palladium
exchange-traded product <PHPD.L>, which gives investors in its
securities exposure to the spot palladium price, rose to a
record 650,273 ounces on Thursday.
Prices of fellow platinum group metal rhodium <RHOD-LON>
continued to correct on Friday after rising to 13-month highs at
$2,750 an ounce at the end of November. They have since declined
23 percent to $2,125 an ounce.
(Reporting by Jan Harvey; Editing by Keiron Henderson)
