* Gold falls below $930 as dollar rallies
* Dollar's reserve currency status bolstered
* Underlying economic problems provide support to gold
(Recasts, updates with quotes, closing prices, adds NEW YORK
to dateline)
By Frank Tang and Kylie MacLellan
NEW YORK/LONDON, June 15 (Reuters) - Gold fell below $930
an ounce on Monday as the dollar rose amid optimism about its
status as a world reserve currency, but economic head winds
could still bolster gold's safe-haven appeal.
Earlier this month, gold rose toward $1,000 an ounce as the
dollar steadily weakened on speculation that Russia would cut
the share of U.S. Treasuries in its reserves, and major
emerging market countries might be diversifying away from the
dollar.
However, the dollar rose broadly on Monday after Russia's
finance minister expressed confidence in the greenback as the
world's reserve currency. []
U.S. August futures <GCQ9> settled down $13.20, or 1.4
percent, at $927.50 an ounce on the COMEX division of the New
York Mercantile Exchange.
Spot gold <XAU=> was at 928.20 at 4:12 p.m. EDT (2012 GMT),
against $937.90 an ounce late in New York on Friday.
George Nickas, commodities broker at FC Stone, said that
the gold market was weighed down by investors' renewed
confidence in the dollar, but he expected further support to
the U.S. currency would be limited.
"The underlying problems of the economy are still
unresolved," and that is bullish for gold, he said.
Investors also took a lead from the cautious tone adopted
by policymakers at the G8 meeting, which some traders said
helped temper optimism about the economy. []
"Gold is very closely following the developments in the
foreign exchange markets, especially dollar/euro," said Peter
Fertig, consultant at Quantitative Commodity Research.
"The more important support is coming in at $921 ... that
would be the next major support level."
Despite the downward pressure from a stronger dollar, gold
took some support from risk-averse sentiment post-G8.
"Until we're really starting to print solid growth numbers,
there are always going to be people who cling to the fact that
we are still in pretty precarious times and they are just going
to buy the risk averse trade," said Citigroup analyst David
Thurtell.
Oil fell below $71 as the dollar firmed, and analysts said
the crude market had rallied too quickly. []
Gold has historically tracked oil prices as it is often
bought as a hedge against inflationary pressures sparked by
higher crude.
Demand for physical gold remained weak. Holdings of the
SPDR Gold Trust, the world's largest bullion exchange-traded
fund, were steady at 1,132.15 tonnes as of June 12 -- unchanged
for a fifth trading session. []
Among other precious metals, silver <XAG=> tracked gold
lower. It was down to $14.08 against $14.79 in the previous
session, having earlier hit $14.03 -- its lowest price in four
weeks.
Platinum <XPT=> was at $1,204.00 an ounce compared with
$1,249.00, while palladium <XPD=> fell more than 3 percent to
$241 from $250.50.
Close Change Pct 2008 YTD
Chg Close Pct Chg
US gold <GCQ9> 927.50 -13.20 -1.4 884.30 4.9
US silver <SIN9> 14.030 -0.845 -5.7 11.295 24.2
US platinum <PLN9> 1213.70 -45.00 -3.6 941.50 28.9
US palladium <PAU9> 246.00 -8.10 -3.2 188.70 30.4
Prices at 4:12 p.m. EDT (2012 GMT)
Gold <XAU=> 928.20 -9.70 -1.0 878.200 5.7
Silver <XAG=> 14.08 -0.71 -4.8 11.30 24.6
Platinum <XPT=> 1204.00 -45.00 -3.6 924.50 30.2
Palladium <XPD=> 241.00 -9.50 -3.8 184.50 30.6
Gold Fix <XAUFIX=> 932.25 -5.00 -0.5 836.50 11.4
Silver Fix <XAGFIX=> 14.310 -0.760 -5.0 14.760 -3.0
Platinum Fix <XPTFIX=> 1234.00 0.00 0.0 1529.00 -19.3
Palladium Fix <XPDFIX=> 249.00 0.00 0.0 365.00 -31.8
------------------------------------------------------------
(Additional reporting by Miho Yoshikawa in Tokyo; editing by
Jim Marshall)
