* Physical buying picks up  sentiment remains cautious
  
  * Coming up: U.S. FOMC rate decision  1915 GMT

    By Susan Thomas	
    LONDON, Dec 13 (Reuters) - Spot gold lifted off
seven-week lows on Tuesday as the euro recovered modestly and
equities steadied, but all gains looked vulnerable on the threat
of possible credit rating downgrades for euro zone nations.	
    Spot gold lost 0.1 percent to $1,663.14 an ounce by
1226 GMT after posting its biggest one-day drop in nearly three
months in the previous session. It touched $1,650.89 earlier,
its lowest since Oct. 25. 	
   U.S. gold was off 0.04 percent at $1,667.60.	
    The euro recovered from a two-month low versus the dollar,
and European stocks were steady after sharp sell-offs on
disappointment about last week's " last ditch"  EU summit to come
up with a clear plan to tackle the single bloc's debt crisis.	
    Short-covering helped the euro rebound modestly, but traders
said there was a clear bias to sell the single currency on any
bounce. A weaker euro makes gold priced in the U.S. dollar less
affordable for holders of the single currency. 	
    " I suspect that the euro will remain under pressure,"  said
Citi analyst David Wilson. 	
    " If we do get any sovereign downgrades this week, I suspect
the euro will be under even more pressure. It's difficult to see
short term what's going to lift gold." 	
    Investors will closely watch for moves by the ratings
agencies. Moody's Investors Service said on Monday it intended
to review the ratings of all 27 members of the European Union in
the first quarter of 2012 after EU leaders offered " few new
measures"  to resolve the crisis in a summit on Friday.	
    Standard &  Poor's last week warned of a possible downgrade
of 15 euro zone nations. Italian and Spanish bond sales later
this week also are likely to provide a barometer of market
sentiment. 	
    " It's all about anxiety and worry,"  said Nick Trevethan,
senior commodities strategist at ANZ in Singapore. " Gold is just
getting lumped in with other markets as risky assets, not
necessarily for the right reason."  	
    Wild swings in gold prices since August have tarnished its
reputation as a safe haven, and bullion has moved in tandem with
riskier assets in the past few months.	


    " The bigger macro issues are still there, which would
generally be supportive for gold, but right now it's all about
the noise around the continued political failure in Europe," 
Wilson said.	
    	
     	
    PHYSICAL BUYING PICKS UP	
    SPDR Gold Trust, the world's largest gold-backed
exchange-traded fund, reported that its holdings dropped 0.605
tonnes to 1,294.796 tonnes by Dec. 12, the lowest in three
weeks. 	
    Physical buying picked up in Asia after the sharp decline in
prices, but many were hesitant to buy in bulk ahead of the
year-end, especially while market sentiment remains fragile on
concerns about Europe's troubles, dealers said. 	
    " We expect physical demand to return in some strength on
approach of $1,650,"  Standard Bank analyst Walter de Wet wrote
in a note to clients.	
    Key support for the metal lay at its 200-day moving average
at $1,617, he said. 	
    " Since early 2009, gold has consistently bounced off its
200d MA. Unless funding issues in Europe deteriorate
substantially from current levels, we expect this support to
hold,"  he said.	
    Spot platinum rose 0.8 percent to $1,479.53 an ounce,
off a seven-week low of $1,476.23 hit in the previous session.	
	
 (Additional reporting by Rujun Shen in Singapore  editing by
Jane Baird)
  
  

Morning Gold & Silver Market Report – 12/13/2011

Closing Gold & Silver Market Report – 12/12/2011

Closing Gold & Silver Market Report – 12/9/2011

* Price set for 1.8 pct weekly fall after ECB

* ETF holdings steady near record bullish options bets up

* Palladium holds near three-month highs

By  Amanda Cooper

LONDON, Dec 8 (Reuters) - Gold fell on Thursday after the head of the European Central Bank played down expectations that the central bank would dramatically increase the measures it is using to fight the debt crisis, thereby undermining the euro.

The ECB delievered a widely-expected quarter-point cut to bring its benchmark refinancing rate to a record low, yet central bank president Mario Draghi said the decision was not unanimous and would not be drawn on whether there would be more cuts.

European Union leaders also start a crucial summit on Friday that investors hope will deliver a comprehensive solution to the region's debt crisis, which now threatens the top-notch credit ratings of Germany and  France.

Although the gold price has struggled to make upward progress this week, largely a function of a preference among investors to hold dollars, ETF holdings of metal are near record highs and a sharp increase in bullish options plays reflects a desire to hold bullion right now.

Lower  euro zone  rates and the ECB's commitment to provide banks with more favourable longer-term funding are, in theory, supportive of gold, although the central bank's lukewarm response to the crisis has left markets dismayed.

Spot gold was last bid at $1,713.80 an ounce by 1507 GMT, down 1.6 percent on the day and set for a 1.8-percent decline this week, as the weakness of the euro against the dollar has made it more attractive for European investors at least to sell assets priced in the U.S. currency.

" The rate cut and what has been said by Mario Draghi are pretty much in line with central expectations from much of the market. Broadly it is positive for gold: additional liquidity and easing but no big surprises no financial 'bazooka'," Tom Kendall, analyst at Credit Suisse said.

Gold can act as a safe-haven for investors in times of financial or economic uncertainty, but in cases of extreme risk aversion, where the desire for cash increases, it is also prone to the kind of sell-offs that hit stocks, bonds or  currencies.

" This is big - a lot of people, stocks, bonds, currencies, had been counting on the ECB and (Draghi's) basically pulled the rug out from under the market," said Brian Dolan, chief strategist at Forex.com in Bedminster, New Jersey. " There's a sense of shock right now."

HOPE FOR THE EURO

Hopes for a definitive plan to tackle the two-year-old euro zone debt crisis were fading a day before the summit and expectations were dented further by pessimistic comments from a senior German official and new figures exposing deepening stress among Europe's banks.

" A final solution out of Europe is highly unlikely," Jeremy Friesen, Commodity Strategist at Societe Generale in Hong Kong, said, but added that a total breakdown was also unlikely as central banks and  finance  ministries have shown the will to cooperate to fight the crisis which is threatening to split up the euro zone and sink the global economy into recession.

" I don't expect Merkel or any hawkish decision-makers to squander this opportunity to really make reforms, now that they have come so far. I don't see them capitulating at this point."

A disappointing result from the summit could undermine the euro and send gold prices lower, at least initially.

ETF holdings of gold have risen to a record above 70 million ounces this week, while the options market shows a strong pick-up in call options, which give the holder the right but not the obligation to buy gold at a set price by a set date, at $1,800 an ounce.

Calls at $1,800 an ounce have risen by more than 3,000 lots, or 3 million ounces, in the last week, indicating a growing belief that the price could be trading above this level by the end of the year. < 0#GC+++>

In other precious metals, silver was quoted down 2.1 percent at $31.79 an ounce, while platinum was last down 1.3 percent at $1,500.49 an ounce.

Platinum is trading at its steepest discount to gold since Reuters began collecting data on the metal's price in 1985.

The price of platinum, which is used principally in jewellery and vehicle catalytic converters, is now more than $200 below the price of gold, highlighting the concern among investors over the impact on the global economy from the euro zone debt crisis.

Any jolt to consumer confidence can result in a drop in discretionary spending on luxury items such as jewellery or new cars, delivering a twin hit to platinum demand.

The market is expected to show a surplus this year of around 195,000 ounces, in contrast with last year's deficit of 25,000 ounces, when demand oustripped supply, according to refiner Johnson Matthey in a recent report.

Palladium was last down 1.3 percent on the day at $664.25 an ounce, having rallied sharply this week to its highest since September, when it hit one-year lows.

" Palladium continued to outperform its sister metal, platinum," HSBC analyst James Steel said in a note

" Market chatter revolved around supply tightness and Russian stockpile concerns. There have also been increases in fund purchases and option call buying recently, we believe," he said. (Reporting by Amanda Cooper Editing by William Hardy)

Closing Gold & Silver Market Report – 12/8/2011

Closing Gold & Silver Market Report – 12/7/2011

* S& P warns mass downgrade for  euro zone  countries

* Market cautious ahead of EU summit, ECB meeting

* Strong German industrial orders helps euro rebound

By Harpreet Bhal

LONDON, Dec 6 (Reuters) - Gold fell to its lowest in nearly a week on Tuesday, hit by persistent fears about Europe's debt crisis after Standard & Poor's warned it could downgrade euro zone nations if no concrete plan to tackle the crisis emerges at a summit this week.

The rating agency's warning it might downgrade 15 countries including Germany and  France  came hard on the heels of a Franco-German initiative to enforce budget discipline across the 17-member zone through EU treaty changes.

Spot gold fell 0.9 percent to $1,705.70 an ounce by 1509 GMT, extending a 1.4 percent drop in the previous session. It earlier fell to its lowest level in nearly a week at $1,703.79 an ounce.

U.S. gold shed 1.5 percent to $1,708.10.

Investors will keep a close eye on an EU summit on Friday in Brussels, where the focus will be on new rules to tighten fiscal integration. Analysts say a summit that falls short could lead to a harsh market reaction that could force a rapid reappraisal by policymakers.

" The ranges are tight in the market and people will be closely watching what happens on December 9. Patience will be seriously tested and if the market doesn't get what it expects people will start to close positions, Georgette Boele, global head of FX and commodity strategy at ABN Amro said.

" We are also seeing a cutback on positioning because the year has been very volatile and people are less and less willing to take on big positions going into the year-end."

Helping to limit the fall in gold, the euro pared losses against the dollar after data showed German industrial orders in October posted their strongest reading in 19 months. .

A weak dollar makes commodities priced in the U.S. unit cheaper for holders of othercurrencies.

Although gold is regarded as a safe haven asset to shield investors in times of uncertainty, it has increasingly become prone to pressure from selling in the wider financial market, moving in tandem with other assets as investor sentiment remains fragile.

ECB EYED

Investors are also likely to keep a close eye on a European Central Bank (ECB) meeting on Thursday, when the bank is expected to cut its main interest rate for the second month running, taking it back to a record low of 1.0 percent or lower if the bank decides a 50 basis point cut is needed.

Australia's central bank cut interest rates by a quarter point to 4.25 percent on Tuesday as tamer inflation at home allowed it to take out some policy insurance against the debt crisis engulfing Europe.

Monetary policy easing raises the inflation outlook and benefits gold, seen as a good inflation hedge.

" Apparently, $1,750 is a tough resistance to break. The market is in need of strong fundamental impetus to break above this mark. Thursday could provide such an impetus as the ECB will meet for its policy meeting," Credit Suisse analysts said in a note.

" Ahead of the ECB meeting, we think sideways trading is the most likely outcome."

Trading volumes were also expected to decline because many traders have closed books to lock in profit before the end of the year, reducing liquidity in the market and increasing the volatility.

Holdings of the world's largest gold-backed exchange-traded fund, SPDR Gold Trust, were unchanged at 1,297.929 tonnes by Dec. 5, just below a near four-month high of 1,298.534 tonnes hit on Nov. 30.

Silver slipped 0.8 percent to $31.78 an ounce, while palladium was down 1.8 percent at $641.47. Platinum fell 1.1 percent to $1,499.49 an ounce. (Editing by Jane Baird)