MARKETS-PRECIOUS (UPDATE 3)
* Fiscal woes support gold but strong dollar caps gains
* Gold priced in euro, sterling approaches record highs
* Investors await Friday's U.S. non-farm payrolls data
(Updates, adds comment, changes dateline from SINGAPORE)
By Michael Taylor and Jan Harvey
LONDON, March 2 (Reuters) - Gold prices rose above $1,120 an ounce on Tuesday as persistent worries about Greece's fiscal health and instability in the currency markets lent some safe-haven support, but strength in the dollar capped gains.
Gold priced in euros and sterling approached their recent record highs, however, as both currencies slipped on Tuesday. Spot gold was bid at $1,121.60 an ounce at 1151 GMT, against $1,118.40 late in New York on Monday. U.S. gold futures for April delivery on the COMEX division of the New York Mercantile Exchange rose $3.70 to $1,122.00 an ounce.
"The dollar has tested recent highs against the euro... but that is not dragging gold down, so obviously there is an underlying strength in gold at these prices," said Saxo Bank senior manager Ole Hansen.
"With the uncertainties going on at the moment, apart from the currency relationship, there hasn't been any particular reason for selling it."
"Gold is doing a bit of sideways trading. We have non-farm payrolls on Friday in the U.S., so we would expect the market to wait for that," he added.
The euro fell to a 9 1/2-month low versus the dollar on Tuesday as further worries over Greek austerity measures added to selling pressure on the single European currency.
Fears over the fiscal health of peripheral euro zone economies have weighed heavily on the euro so far this year, knocking it down by nearly 5.5 percent against the dollar.
The European Union on Monday urged Greece to agree additional austerity measures within days to tackle its fiscal crisis. Greek officials said a cabinet meeting on the economy will take place on Wednesday. Adding to pressure on the euro, former European Central Bank economist Otmar Issing said Greece should turn to the International Monetary Fund rather than other euro zone states for help in tackling its debt crisis.
Euro-priced gold rose above 830 euros an ounce on Tuesday, within a few cents of its record high of 830.41 euros an ounce set last week.
STERLING GOLD EYES HIGH
Sterling-denominated gold also rose above 750 pounds an ounce, near Monday's record high at 753.69 pounds an ounce, meanwhile, as the British currency was driven lower by fears that the next UK general election could result in a hung parliament.
"For gold, all the action is in non-U.S. dollar currencies," said Commerzbank in a note. "Given that the U.S. dollar has recently gained in strength, gold expressed in U.S. dollars is also holding up astonishingly well."
In the physical market, sales of gold scrap picked up in Southeast Asia due to recent gains in bullion prices, while Indian buyers stayed on the sidelines.
The world's largest gold-backed exchange-traded fund, SPDR Gold Trust, said its holdings stood at 1,106.987 tonnes by March 1, unchanged from the previous business day.
Elsewhere, silver was at $16.58 an ounce against $16.45, platinum at $1,557 an ounce versus $1,546.50, and palladium at $436.50 an ounce versus $433.50.
Analysts said strong fundamentals and ETF inflows were helping support both platinium and palladium prices.
Global commodities prices are expected to rise slightly due to some demand from emerging market economies but a broad-based price spike is unlikely, a senior International Monetary Fund official said on Monday.
(Reporting by Jan Harvey; Editing by Amanda Cooper)
