PRECIOUS-Gold tracks oil lower, ECB meeting eyed

* Euro falls against dollar, awaits this week's ECB meeting

* Oil drops more than $1 a barrel

* SPDR holdings slip 0.28 tonnes

* Gold's net long positions up on COMEX
(Updates prices)

By Lewa Pardomuan

SINGAPORE, Jan 12 (Reuters) - Gold slipped in thin trade on
Monday as oil and the euro extended losses, but investors were
likely to buy bullion on dips given continued global economic
uncertainty.

Investors awaited the European Central Bank's policy
meeting on Thursday, which could set the direction of the
dollar amid expectations of more rate cuts that kept the euro
on the defensive. [ID:nL9311168]

Gold XAU= was trading at $850.90 an ounce, down $2.70 an
ounce from New York's notional close on Friday.

"I would say sentiment is still bullish. People still don't
have confidence in financial institutions," said Ronald Leung,
director of Lee Cheong Gold Dealers in Hong Kong.

Oil CLc1 dropped more than $1 to below $40 a barrel on
persistent worries about falling demand following Friday's
dismal U.S. payrolls report, which showed 1.1 million jobs lost
since November and the highest unemployment rate since 1993.
[O/R].

Gold was expected to trade in a range as markets waited for
more from U.S. President-elect Barack Obama on a rescue plan to
stabilise the financial system, said Leung.

Obama vowed to restructure a financial rescue plan to save
more U.S. families from home foreclosures, as he considered on
Sunday whether to seek additional funds from a $700 billion
bailout program. [ID:nN11286639]

Gold has bounced more than 20 percent since tumbling to a
13-month low around $680 in late October. Bullion struck record
of $1,030.80 last March.

The euro EUR= fell to $1.3392 amid talk of an aggressive
cut in eurozone interest rates later this week, with
speculation rife the central bank will cut its key lending rate
by 50 basis points to 2 percent. [USD/]

"I think the focus will be on the ECB rate decision later
this week and if expectations are for the central bank to lower
rates, then the euro should weaken further and the dollar is
likely to move higher," said a dealer in Singapore.

"That's going to put a cap on gold. For the near term, gold
will perhaps trade within a $50 range," he said.

Speculative gold players boosted their net long positions
to 133,604 long on gold futures traded on COMEX at Jan. 6, up
from 125,961 net longs at Dec. 30, Commodity Futures Trading
Commission data showed.

The world's largest gold-backed exchange-traded fund, the
SPDR Gold Trust GLD, said it held787.60 tonnes of gold as of
Jan. 9, down 0.28 tonnes from arecord of 787.88 tonnes on Jan.
7. [GOL/SPDR]

Holdings in the trust, which issues securities backed by
physical stocks of gold, began climbing again in December the
poor prospects for the global economy ignited demand for
bullion as a safe-haven asset. XAUEXT-NYS-TT.

Platinum XPT= was trading at $993.00 an ounce, up $0.50
from New York's notional close. New York gold futures GCZ9
fell $3.6 an ounce to $851.4 in electronic trade.
Precious metals prices at 0711 GMT
Metal Last Change Pct chg YTD pct chg
Turnover
Spot Gold 850.90 -2.70 -0.32 2.19
Spot Silver 11.18 -0.06 -0.53 -24.31
Spot Platinum 993.00 0.50 +0.05 -34.67
Spot Palladium 191.50 0.50 +0.26 -47.96
TOCOM Gold 2519.00 24.00 +0.96 -17.68
32090
TOCOM Platinum 2934.00 14.00 +0.48 -45.05
8707
TOCOM Silver 326.50 4.50 +1.40 -39.65
338
TOCOM Palladium 574.00 4.00 +0.70 -57.51
145
Euro/Dollar 1.3427
Dollar/Yen 90.15
TOCOM prices in yen per gram, except TOCOM silver which is
priced in yen per 10 grams. Spot prices in $ per ounce.
(Editing by Ben Tan)