* Euro/dollar sinks back below $1.40 as Treasury yields rise
* Oil prices slide towards $67/bbl
(Updates prices, adds comment)
By Jan Harvey
LONDON, June 8 (Reuters) - Gold slipped on Monday, extending
the previous session's 2 percent losses, as the stronger dollar
sparked selling of commodities.
Spot gold <XAU=> was bid at $949.90 an ounce at 1223 GMT,
against $955.30 an ounce late in New York on Friday. U.S. gold
futures for June delivery <GCM9> on the COMEX division of the
New York Mercantile Exchange fell $11.20 to $950.50 an ounce.
"With the dollar regaining its lost footage, gold gains from
here on will be difficult unless risk aversion triggers buying
of bullion once again," said Pradeep Unni, senior analyst at
Richcomm Global Services.
"The U.S. dollar index is back above 80, which is a crucial
level, and this hints that dollar may strengthen further," he
added. "If gold slips through $954-$951 support, a swift slide
to $934-$930 seems inevitable."
The dollar climbed against the euro on Monday, extending the
sharp gains it posted late last week, as the single currency was
dragged lower by another soveriegn downgrade for Ireland. []
U.S. Treasury yields rose to seven-month highs, prompting
investors to cover short-dollar positions. Strength in the U.S.
currency has weighed on gold, as it makes dollar-priced
commodities more expensive for holders of other currencies.
Other commodities were also sold off, with oil, a key
indicator of interest in the asset class, falling more than $1 a
barrel, and industrial metals also softening. [] []
Falling crude prices also dent interest in gold as a hedge
against oil-led inflation.
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Investors' appetite for gold also appeared to be waning,
with the bullion holdings of the largest gold ETF, New York's
SPDR Gold Trust <GLD>, declining on Friday. ETFs issue
securities backed by physical stocks of a metal. []
Turkey, one of the world's leading gold consumers, said its
imports of the metal fell back to zero in May from 26 kg the
previous month. Abu Dhabi gold sales also remained flat, an
industry group said. [] []
Silver <XAG=> was at $14.94 an ounce against $15.23,
tracking moves in gold. Silver can be bought as a cheaper
alternative to gold, analysts said.
Platinum <XPT=> was bid at $1,230 an ounce against $1,262
late in New York on Friday, while palladium <XPD=> was at $247
against $253.
The metals, primarily used in autocatalysts, are selling off
after hefty gains last week, pressurised by the firm dollar.
"We've seen a bit of a strengthening in the dollar and some
of the consumption side numbers from the auto industry haven't
been that positive," said Societe Generale analyst David Wilson.
"We saw a pick-up in German car sales in May, but there was
also quite a sizeable continued fall-off in U.S. auto sales."
ETF Securities' platinum and palladium backed ETCs both grew
last week, while Zurich Cantonal Bank's Platinum ETF <ZPLA.S>
added 6,359 ounces or 3.7 percent to its holdings.
However, Wilson said: "That doesn't seem to have been enough
to counteract the more negative sentiment from a slightly
strengthening dollar."
(Reporting by Jan Harvey; Editing by William Hardy)
