RPT-PRECIOUS-Gold falls as dollar rebounds, hovers above $1,000

(Repeats to additional subscribers)

* Dollar rebounds on short-covering, gold retreats from highs

* SPDR holdings XAUEXT-NYS-TT flat as investor demand weak

By Chikako Mogi

TOKYO, Sept 14 (Reuters) - Gold prices erased earlier gains
and fell on Monday, as the dollar rebounded on short-covering and
dragged down other commodities and equities.

Gold prices topped $1,000 per ounce last week and closed
above that level on Friday for the first time since March 2008,
as investors sold the dollar to buy higher-yielding and riskier
assets on growing optimism about the outlook for the global
economy.

Some traders have questioned whether gold's current high
levels can be sustained, as much of its recent rally has been
driven by funds emboldened by favourable technical charts while
physical demand and that from individuals remain weak.

"The dollar's rebound was the trigger," Ben Westmore, a
commodities economist at National Australia Bank, said of gold's
retreat. "Gold may be pressured by some unwinding of holdings by
funds."

Westmore said investors were likely adjusting their outlook
for demand, refocusing on the view that growth was likely to wane
after stimulus measures from governments fade, and a V-shaped
recovery is unlikely.

He added that investors may be reassessing commodities'
stockpile data that suggests fundamentals remain weak, as well as
their attitude towards China, whose imports have helped push up
prices across markets.

But he said while growth in demand may slow, this new round
of market correction was unlikely to dent demand.

Spot gold XAU= eased 0.4 percent to $1,000.40 as of 0524
GMT, after rising 0.4 percent to a high of $1,008.70 per ounce
earlier on Monday. New York's notional close was $1,004.85. It
hit $1,011.55 on Friday, its highest since March 2008.

U.S. gold futures for December delivery GCZ9 fell 0.5
percent to $1,001.8 per ounce, slipping from an earlier high of
$1,010.8.

Futures stood at $1,006.40 an ounce on the COMEX division of
the New York Mercantile Exchange. Friday's session high was
$1,013.70, the highest since Feb. 20.

The dollar rose broadly on Monday with the Australian and New
Zealand dollars falling about 1 percent against the greenback as
investors covered short dollar positions, making waves across
other markets.

The dollar index, a gauge for the greenback's performance
against six other major currencies, rose 0.4 percent to 76.917
.DXY, off its one-year low of 76.457 struck on Friday.

Despite gold's recent rally, holdings at the world's largest
gold-backed exchange-traded fund, the SPDR Gold Trust (GLD),
stood at 1,077.63 tonnes as of Sept. 13, unchanged from the
previous business day. [GOL/SPDR]

But noncommercial net long U.S. gold futures positions rose
to 224,676 lots in the week to Sept. 8 from 184,501 lots, a
weekly report by the U.S. Commodity Futures Trading Commission
showed. [ID:nN11460788]

The drop in gold prices pulled down other precious metals,
with silver XAG= down 1.7 percent to $16.45 from $16.74. On
Friday it hit its highest level since early August 2008 at
$16.97.

Platinum XPT= fell 1.2 percent to $1,299.50 from $1,315.50,
after touching a 1-year high of $1,317.50 an ounce earlier on
Monday.
PRICES
Precious metals prices at 0526 GMT
Metal Last Change Pct chg YTD pct chg Turnover
Spot Gold 1000.80 -4.05 -0.40 13.71
Spot Silver 16.46 -0.28 -1.67 45.41
Spot Platinum 1296.00 -19.50 -1.48 39.06
Spot Palladium 288.50 -1.50 -0.52 56.37
TOCOM Gold 2922.00 -26.00 -0.88 13.56 37498
TOCOM Platinum 3786.00 4.00 +0.11 42.76 9675
TOCOM Silver 477.70 -15.30 -3.10 49.61 427
TOCOM Palladium 849.00 -9.00 -1.05 54.36 183
Euro/Dollar 1.4534
Dollar/Yen 90.46
TOCOM prices in yen per gram, except TOCOM silver which is
priced in yen per 10 grams. Spot prices in $ per ounce.
(Additional reporting by Miho Yoshikawa; Editing by Michael
Watson)