Gold steadies in Europe

Gold was steady on Friday, after a fall of as much as 2 percent the day before, as uncertainty over Greece's ability to remain solvent lingered. Gold was still set for its largest weekly decline since the so-called commodities "flash crash" of early May, which saw the raw materials complex stage its biggest weekly fall on record.
The euro briefly pared losses against the dollar after the release of better-than-expected US durable goods data, which eased investor concerns about the economic slowdown.
Spot gold fell 0.07 percent to $1,519.49 an ounce by 1302 GMT, on course for a fall of more than 1 percent this week. But while gold looked vulnerable according to the charts, analysts said the high level of uncertainty would stem any steeper sell-offs. "Technically, it doesn't look ideal, but even if we breach $1510, at $1,480, we'll stop. I can't see people liquidating gold right now with everything that is happening," said VTB Capital analyst Andrey Kryuchenkov.
"You have Greece and there was nothing to indicate from the Fed that they're turning hawkish just yet," he said. Gold has thrived on the expectation of an extended period of low US interest rates, which depress the dollar against other currencies and place bullion, which bears no yield of its own, in a better position to compete for investor cash against stocks or bonds.
The Federal Reserve earlier this week cut its forecasts for US growth, but did not signal there would be any additional policy measures, such as quantitative easing, to support the economy. Final US GDP for the first quarter was revised to a 1.9 percent increase from a 1.8 rise, in line with forecasts. "We still are in very uncertain times and it's likely to continue until we see greater signs of economic growth globally, particularly in the United States, and we start to see the European debt situation ease," said Darren Heathcote, head of trading at Investec Australia.
"While those problems remain we are likely to see gold well supported. Investors flee to gold in times of trouble as they have done consistently for a very long time." Reflecting the push earlier this week into gold rather than into increasingly volatile currencies was the rise in Australian-dollar denominated gold to its highest in nearly a year and the rise in sterling-gold to record highs as investors punished the pound. Global holdings of gold in exchange-traded funds are set for a 20,8120-oz rise this week, having risen by 254,000 oz so far this month, as investors have favoured safe-haven assets rather than more industrially-linked products.
This compares with net outflows of 8.891 million ounces of metal from silver ETFs and declines of 36,000 oz in palladium ETFs. Silver was down around 0.99 percent on the day at $34.9 an ounce, while the gold/silver ratio - the number of ounces of silver needed to buy one ounce of gold - is close to its highest in a month, highlighting gold's outperformance relative to silver.
News that industrialised nations would release oil from emergency stockpiles for the third time in history in a bid to tame high energy prices that have been weighing on the global economy could cap gold's gains, but should boost prices of industrial metals.
The news sent oil prices tumbling to four-month lows on Thursday but prices have regained some footing on Friday as traders assessed how much supply would reach the market.
Bullion investors are also paying close attention to discussions over the US debt limit after budget talks collapsed on Thursday when Republican negotiators walked out, casting doubt on Washington's ability to reach a deal that would allow the government to keep borrowing and avoid a debt default. Platinum was last down 0.07 percent at $1,693.2 an ounce, having fallen on Wednesday to three-month lows, while palladium was down 0.65 percent at $737.75.