* Dollar edges higher versus the euro ahead of ECB decision
* Trichet press conference, U.S. data awaited
* Platinum, palladium ETF could distract from gold-analyst
(Updates prices)
By Jan Harvey
LONDON, Jan 14 (Reuters) - Gold eased slightly in Europe on
Thursday as the dollar firmed a touch against the euro ahead of
a European Central Bank policy decision later in the session,
denting interest in the metal as an alternative asset.
Traders are eyeing a raft of U.S. data due later, including
retail sales, business inventories and import/export prices for
December and weekly jobless claims for clues as to the dollar's
next direction.
Spot gold <XAU=> was bid at $1,135.20 an ounce at 1212 GMT,
against $1,137.60 late in New York on Wednesday. U.S. gold
futures for February delivery <GCG0> on the COMEX division of
the New York Mercantile Exchange eased $1.00 to $1,135.80.
"The market is a bit cautious ahead of the ECB press meet
and retail sales figures," said Pradeep Unni, senior analyst at
Richcomm Global Services.
"The U.S. data is expected to come in weaker, so the dollar
may give up some of its gains."
The euro edged lower versus the dollar on Thursday, with
investors cautious ahead of an ECB policy decision and news
conference by its president Jean-Claude Trichet. []
No change is expected to euro zone interest rates or the
rate outlook, but the central bank's view on Greece's fiscal
troubles will be a focus. The dollar-euro is likely to remain
the chief price driver for gold, analysts said. []
"We continue to see potential for additional near-term
weakness (in gold), particularly if, as we suspect, there is a
continuation of the U.S. dollar rally that began in December,"
said Numis Securities in a note.
"The decisive break through $1,000 an ounce could now
provide a solid floor to any correction, although we would not
be surprised to see some panic/stop-loss selling if this level
is breached."
OIL RISES
Oil prices held near $80 a barrel, but gave up some initial
gains after a short-covering rally that lifted them in early
trade ran out of steam. []
Gold tends to track crude prices, as the metal can be bought
as a hedge against oil-led inflation.
Interest in the largest gold-backed exchange-traded fund,
New York's SPDR Gold Trust <GLD>, was steady on Wednesday,
having declined nearly 18 tonnes since the New Year. []
On the production side, gold output in South Africa, the
world's third largest miner of the precious metal, fell 4.9
percent in November, Statistics South Africa said. []
Among other precious metals, silver <XAG=> was bid at $18.48
an ounce against $18.59, while platinum <XPT=> was at $1,577 an
ounce versus $1,574.
Palladium <XPD=> bucked the static trend of the other metals
to rise nearly 3 percent to $433.50 versus $421.50, however.
The platinum group metals are being underpinned by fresh
investment interest after the launch of new platinum- and
palladium-based ETFs in New York last Friday. The funds added
170,000 ounces of metal in their first two trading sessions.
Interest in platinum group metals-backed ETFs could detract
attention from similar products backed by gold, like the SPDR
fund, Goldman Sachs said in a research note.
"The gold ETFs may face increased competition for investor
demand in 2010 from the introduction of both the platinum (PPLT)
and palladium (PALL) PGM ETFs," the bank said.
"While these new physical-backed ETFs present a downside
risk to gold-ETF demand and gold prices, they represent an
upside risk to platinum prices, and we continue to recommend a
long position in platinum as a 'gold-plus' trade," it added.
(Reporting by Jan Harvey; Editing by Keiron Henderson)
