* Gold eases after six days of gains
* Middle East turmoil underpins
* Swiss palladium exports highest since July 2010
* Coming Up: U.S. consumer confidence Feb; 1500 GMT
(Updates prices)
By Amanda Cooper
LONDON, Feb 22 (Reuters) - Gold fell on Tuesday, following
six days of gains, as a rising dollar outweighed safe-haven
demand arising from violence in the Middle East, and silver
retreated from Monday's 31-year peaks.
Deadly protests in Libya pushed oil prices to 2-1/2 year
highs, fanning fears of inflation and undermining investor
confidence in the global economic outlook.
Libyan leader Muammar Gaddafi vowed defiance in the face of
a mounting revolt against his 41-year rule on Tuesday, making a
fleeting television appearance to scorn protesters and deny he
had fled the country. []
The gold price has risen by nearly 5 percent this month as
protests in favour of democratic reform across North Africa and
the Middle East turned bloody. Investors have grown increasingly
uneasy that the crisis could spread.
Spot gold <XAU=> was last down 0.6 percent at $1,394.14 an
ounce at 1235 GMT, having risen on Monday to its highest in
about seven weeks. U.S. April gold futures <GCJ1> were up 0.7
percent at $1,398.50 an ounce.
"It's not all one-way traffic," said Credit Agricole analyst
Robin Bhar. "Obviously, we've had the turmoil escalating in the
region and jitters and it's all understandable. Maybe this is
the top for the time being."
He added, "Those safe-havens -- the dollar, Treasuries and
gold -- should stay in demand, and other riskier assets such as
equities and copper and so on will get sold off as we've seen in
the last 12 hours or so."
LIBYA IN FOCUS
The dollar rallied broadly, creating a headwind for gold as
the escalating tension in Libya prompted selling in
higher-yielding assets such as the euro <EUR=> in favour of the
U.S. currency and the Swiss franc <CHF=>.
"The current situation there is really akin to a keg of
dynamite," said Ong Yin Ling, an investment analyst at Phillip
Futures in Singapore.
"Whether Gaddafi will be toppled or whether we will witness
a revolution, I think the final outcome is still uncertain. But
the situation is likely to get worse before it gets better.
Going forward, (gold) could still remain supported due to the
crisis, which is unlikely to be resolved anytime soon."
Gold, like Treasuries and the Swiss franc, tends to draw a
bid from investors in times of political or financial turmoil as
it did in 2010 with the euro zone debt crisis.
Gold is still 2.7 percent below December's record high of
$1,435.90 an ounce, but dealers in Asia reported a pick-up in
sales of scrap after the spot price's near-4 percent rise over
the prior six sessions. []
Silver <XAG=> came under pressure in line with other
industrial commodities, falling by as much as 4.3 percent to a
low of $32.39 an ounce, as investors closed their positions
following a three-day rally that lifted prices by nearly 4
percent.
It later traded at $33.15 an ounce.
The price on Monday hit its highest since early 1980 above
$34 an ounce, driven by limited supplies for near-term delivery
and the prospect for rising demand as the wider economy
recovers.
The gold-silver ratio, used to measure how many ounces of
silver can buy one ounce of gold, fell on Monday to a 13-year
low around 41, reflecting silver's recent outperformance over
gold.
Platinum and palladium fell in line with base metals.
[]
Data from Switzerland, a major clearing hub for platinum
group metals in Europe, showed palladium exports reached their
highest since July 2010.
Exports of palladium, used mainly in catalytic converters
for gasoline-powered vehicles, rose to 9,938 kg from 6,374 kg in
December, the largest amount since 11,731 kg in July last year.
[]
Spot palladium <XPD=> was last down 2.7 percent at $830.50,
while platinum <XPT=> was down 1.5 percent at $1,818.74.
(Additional reporting by Lewa Pardomuan in Singapore; Editing
by Jane Baird)
