* Gold up but investors cautious amid Dubai debt crisis
* Gold may head back toward record, cenbank buying eyed
* Weak dollar underpins gold prices after early losses
(Recasts, updates comments, closing prices, market activity,
adds NEW YORK to dateline)
By Frank Tang and Humeyra Pamuk
NEW YORK/LONDON, Nov 30 (Reuters) - Gold futures eked out a
gain on the back of a weaker dollar on Monday, recovering from
early investor selling of bullion for cash as they considered
what Dubai's loan payment troubles means for financial
markets.
The precious metal was under pressure after falling as
much as 5 percent on Friday on news that Dubai planned to delay
billions of dollars in debt, reviving fears of another global
credit crisis.
Miguel Perez-Santalla, vice president of sales at Heraeus,
said that gold fell as investors needed to raise cash to cover
losses amid debt woes in Dubai, which is typically a major gold
buyer.
Bullion is on track for a 12 percent rise in November alone
and the precious metal is only 2 percent below its record high
of $1,194.90 an ounce reached on Friday. So far this year it
has gained around 33 percent.
Spot gold <XAU=> stood at $1,178.65 an ounce at 3:45 p.m.
EST (2045 GMT), versus $1,176.70 an ounce late in New York on
Friday, when it tumbled to $1,136.80 an ounce, its lowest price
since Nov. 20.
COMEX February gold <GCG0> settled up $6.80 at $1,182.30 an
ounce on the NYMEX.
The precious metal hit record highs approaching $1,200 per
ounce.
"Dubai was a trigger for a correction in gold, but ... it
was a correction that might have come anyway given how much
gold has risen," said Jesper Dannesboe, senior commodity
strategist at Societe Generale.
"If there's any uncertainty gold will initially fall,
people will close out long positions ... (but) I wouldn't be
surprised if you get strong buying on dips," he added.
Support was seen coming from physical buying on dips, the
prospect of further gold buying by emerging market central
banks and bullion's appeal as a hedge against inflation.
Gold's losses were also limited by comments from a senior
Chinese official who said Dubai's debt crisis could be China's
opportunity to snap up gold and oil assets. []
The dollar fell against the euro and a basket of major
currencies <.DXY>, boosting gold. A weaker dollar makes
dollar-priced gold more attractive for non-U.S. investors.
CENTRAL BANK BUYING
Bullion's long-term appeal remains undimmed, analysts said,
due to increasing appetite from central banks to diversify
their reserves and buy more gold, further dollar weakness and
the metal's allure as a hedge against inflation.
Last week, the International Monetary Fund said it had sold
10 tonnes of gold to the Central Bank of Sri Lanka, adding the
sale was part of the 403.3 tonnes approved by its executive
board in September. []
The IMF has already sold 202 tonnes to the Reserve Bank of
India and the Bank of Mauritius.
Silver <XAG=> was at $18.37 an ounce versus $18.25 an ounce
on Friday, when it hit a near two-week low of $17.66.
Platinum <XPT=> was at $1,451 an ounce, up from a close of
$1,436.50 an ounce on Friday, when it touched a one week low of
$1,418.50.
Palladium <XPD=> was at $362.50 versus $362 an ounce on
Friday, when it touched a one-week low of $351.
Close Change Pct 2008 YTD
Chg Close % Chg
US gold <GCG0> 1182.30 6.8 0.6 884.3 33.7
US silver <SIH0> 18.525 0.190 1.0 11.295 64.0
US platinum <PLF0> 1460.20 13.10 0.9 941.50 55.1
US palladium <PAH0> 366.20 -2.35 -0.6 188.70 94.1
Prices at 2:39 p.m. EST (1939 GMT)
Gold <XAU=> 1176.15 -0.55 0.0 878.20 33.9
Silver <XAG=> 18.37 0.12 0.7 11.30 62.6
Platinum <XPT=> 1454.50 18.00 1.3 924.50 57.3
Palladium <XPD=> 362.00 0.000 0.0 184.50 96.2
Gold Fix <XAUFIX=> 1175.75 3.75 0.3 836.50 40.6
Silver Fix <XAGFIX=> 18.14 16.00 0.9 14.76 22.9
Platinum Fix <XPTFIX=> 1442.00 2.00 0.1 1529 -5.7
Palladium Fix<XPDFIX=> 360.50 1.50 0.4 365.0 -1.2
(Additional reporting by Maytaal Angel in London)
((frank.tang@thomsonreuters.com; +1 646 223 6126;
Reuters Messaging: frank.tang.reuters.com@reuters.net))
((For help: Click "Contact Us" in your desk top, click here
[] or call 1-800-738-8377 for Reuters Products and
1-888-463-3383 for Thomson products; For client training:
training.americas@thomsonreuters.com ; +1 646-223-5546))
