Gold still down, weaker euro blamed

Tue May 22, 2012 1:53pm EDT
 
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By Amanda Cooper and Josephine Mason

LONDON/NEW YORK (Reuters) - Gold remained under pressure trading below a near-term technical support level on Tuesday due to a weaker euro, with investors betting against a meeting of European leaders this week doing much to tackle the region's debt crisis.

Platinum tracked gold lower, shrugging off news of a fresh production outage in South Africa.

The euro remained clear of last week's four-month lows but was stuck in negative territory against the dollar as worries about Greek politics and Spanish banking problems kept the currency under pressure. <FRX/>

Spot gold was down 0.63 percent at $1,576.21 an ounce at 13:45 p.m. (1745 GMT).

U.S. gold futures for June delivery were down $6.1 or 0.38 percent at $1,582.6 but off an intraday low of $1,572 hit earlier.

While prices are up from the December lows revisited last week, bullion was still on a weak technical footing, trading below its 14-day moving average.

Some U.S. investors were already focusing on the long Memorial Day holiday weekend, but most were bracing for a possible recovery in the euro if an informal European summit in Brussels on Wednesday agrees on a pan-European bond issue aimed at raising much-needed cash to bolster Greece's banking system.

France's new president, Francois Hollande, said he wanted all options on the table to stimulate growth in Europe when the EU leaders meet and "won't speak about euro bonds as I don't want to upset anybody.   Continued...