* Gold holding near highs; safe haven fears support
* May see downward correction before resuming uptrend
(Updates with comment, refreshes prices, repeats to broaden
distribution)
By Amanda Cooper
LONDON, June 28 (Reuters) - Gold was set for its third
successive daily rise on Monday, supported by uncertainty over
the resilience of the global economic recovery and by
resurfacing geopolitical tensions with Iran.
Gold prices flirted with sessions highs as the euro came
under renewed pressure to fall to a 1-1/2 year low against
sterling <EURGBP=> and eased against the dollar, while euro zone
government bonds rose as investors were unsettled by a fall on
Wall Street and persistent concern about Europe's debt crisis.
"Really the big driver is investor perception, investor risk
appetite and do we see any nervousness over the European (debt)
issue," said Societe Generale analyst David Wilson.
"Sentiment is still quite brittle, so we can get intraday
moves in either direction, but the longer gold stays above
$1,250 and consolidates, the more likely we are for a leg up
rather than a leg down," he said.
Spot gold <XAU=> rose $7.80 to $1,261.35 an ounce by 1415
GMT, having hit an all-time high of $1,264.90 an ounce last
Monday. U.S. gold futures for August delivery <GCQ0> rose $5.50
cents to $1,261.30 an ounce.
Adding to the bullish backdrop for gold were comments from
U.S. intelligence officials that Iran has enough fissile
material for two atomic bombs. []
Gold came under modest pressure earlier in the day from a
rise in the dollar as its traditional inverse relation to the
greenback briefly reestablished itself, while the broader
markets were largely unperturbed by the weekend's meeting of G20
leaders in Toronto.
SAFE HAVEN SWEEP
But flagging equities and the broad decline in the euro
reinvigorated the safe-haven sweep into both the U.S. currency
<.DXY> and gold, prompting the two to move in tandem.
"The underlying safe-haven concerns that have supported
prices -- the economic environment, Europe's fiscal outlook and
the longer-term prospects for inflation, remain," said David
Moore, commodities strategist at Commonwealth Bank of Australia.
"The G20 hasn't had a significant impact on markets, and
while concerns about Iran's nuclear capacity are nothing new,
there seems to be additional clarity."
With this in mind, gold could rise further to surpass the
June 21 record at $1,264.90 per ounce to touch $1,270, as
bullish momentum is strong, according to Reuters technical
analyst Wang Tao.
He noted the bulls were taking control, with prices in an
ascending channel from a $1,224.30 low struck last Wednesday and
sharp rises and mild falls. []
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Gold was little moved by data that showed U.S. consumer
spending rose more than expected in May, even as savings touched
their highest in eight months, while a measure of inflation
showed fairly muted core price pressures. []
However, a continued contraction in physical demand from
traditional end-users could undermine gold, at least in the
short-term, analysts said.
The head of the Bombay Bullion Association said on Monday
that gold imports into top consumer India are likely to have
fallen by 75 percent in June from 29.9 tonnes a year ago. Suresh
Hundia, president of BBA, told Reuters this bearish estimate
could be overly optimistic and the final figures could be lower
than this.
"The numbers are so bad, nobody wants to share it this
time," he said referring to the importing banks and trading
agencies, which contribute their data to the trade body.
[]
While consumer demand has been dampened by gold prices near
record highs, concern about the stability of the wider financial
markets has fed demand for gold-related investment vehicles.
The world's largest gold-backed exchange-traded fund, SPDR
Gold Trust <GLD.P> said its holdings remained unchanged at an
all-time high at 1,316.177 tonnes. []
Silver <XAG=> was up at $19.19 an ounce, from $19.04 late in
New York on Friday, while in the platinum group metals complex,
platinum <XPT=> rose 0.9 percent to $1,580.00 and palladium
<XPD=> was up about 0.3 percent at $476.00.
(Additional reporting by Nick Trevethan in Singapore; Editing
by Sue Thomas)
