LONDON, July 29 - Gold trickled lower in Europe on Tuesday, as the euro eased against the dollar awaiting direction from U.S. economic data later in the day, while platinum scored a 4-1/2 month high on further speculative buying. Silver fell away from the previous day's 3-1/4 year high, at $5.21 an ounce, which it would need to regain rapidly to sustain its recent rally. Spot gold was last quoted at $363.70/364.20 by 0957 GMT, down from New York's close on Monday at $364.90/365.40. "Economic reports and figures have recently been influencing gold movements with gold behaving like a currency," Standard Bank London said in a daily report. Traders would therefore be keeping an eye out for the July U.S. consumer confidence report at 1400 GMT, with a reading from the Conference Board of 85.0 forecast, up from 83.5 in June. Big moves in currency, and therefore gold, would probably only come after more data -- manufacturing, gross domestic product and jobs data -- was released later in the week. Depending on the outcome, the euro/dollar could be pushed up over $1.16 towards record highs or right back down to $1.11. At 0957 GMT, the euro was trading around $1.149, having fallen back under $1.15 earlier. Gold had rallied by some $17, or nearly five percent, from its lows just above $350 last Thursday to a six-week high yesterday as investment funds began to pour money back in to the safe haven asset. Analysts said it might find it difficult to make much further headway unless the dollar weakened significantly again, making gold more attractive for European-based investors. "Notwithstanding our suspicions that the gold market may be attracting interest from more than the usual suspects, we believe that the rally is getting a bit long in the tooth," John Reade of UBS Investment Bank said.
PLATINUM FIRM
The wave of investment buying which has buoyed many commodities over the past week has also lifted platinum to within a few dollars of a 23-year high set in March at $708 an ounce. "It has been mainly driven by speculators. Physical business is pretty quiet," one trader said. Platinum was set at $700 an ounce in the London fixing session, up from $695.00 the previous day and its highest level since March 13. Spot platinum subsequently retreated to $697.00/702.00, unchanged from New York's previous quote. Traders and analysts said platinum was vulnerable to losses given the rally's speculative nature. "Platinum prices have moved up again...but look increasingly fragile as the fund community is the only buyer of note," Ingrid Sternby, analyst with Barclays Capital, said in a daily note. Silver was unable to sustain the previous day's brief visit above $5.20 and dropped back towards $5.00 on Tuesday. Spot was quoted at $5.04/5.06 by 0552 GMT, down from New York's previous $5.18/5.20. However, given the metal's volatile nature and the fund's appetite to buy the metal, further short-term gains could be in store, although most analysts remained unconvinced of the longevity of the rally. "Silver has a better chance to try $5.50 objective if it is done early, or else, retracement could take it back lower to the $4.90 level," Standard Bank said.