Gold fell in Europe on Wednesday and platinum dropped below $1,100 an ounce for the first time since May 18 as the dollar firmed against the euro, making precious metals more expensive for holders of other currencies.

Hard commodities weakened across the board, hit by global economic concerns and worries a potential clampdown on speculation in U.S. energy and commodity trading could hurt buying of the asset class.

Spot gold slipped to a low of $915.20 an ounce and was bid at $918.00 an ounce at 1414 GMT, against $923.30 an ounce late in New York on Tuesday. Meanwhile platinum was at $1,109 an ounce from $1,132, having touched a low of $1,099.

The dollar climbed broadly as growing risk aversion prompted buying of the precious metal as a safe store of value. The U.S. unit, weakness in which boosts gold’s appeal as a currency hedge, is currently the metal’s chief driver.

“In the last few weeks, the relationship between gold and the dollar has been fairly slavish,” said Stephen Briggs, an analyst at RBS Global Banking & Markets. “But gold has even been underperforming that, if you look at the euro price.”

He said seasonally weak demand in the third quarter and a tailing off in investment buying are also pressuring the metal.

Gold buying in India, the world’s largest bullion consumer, was weak as the dollar strengthened against the rupee, making the metal more expensive for local consumers.

Meanwhile gold jewellery sales in Dubai were down 30 percent in June from a year earlier, as high prices and the economic downturn hit buying.

U.S. gold futures for August delivery on the COMEX division of the New York Mercantile Exchange slipped $10.70 to $918.40 an ounce.

CAUTION

On the wider markets, sentiment was cautious, with European shares falling for the fifth straight session. The losses reflected a slide in Wall Street stocks to a ten-week low on Tuesday, amid fears over economic weakness.

Deutsche Bank analyst Michael Blumenroth said stock market weakness could be seen as a sign of fresh trouble to come for the economy, which may prompt further gold buying later in the year.

Industrial commodities slipped amid doubts over the outlook for the global economy, with both oil and industrial metals trending lower. The more industrial precious metals — platinum, palladium and silver — all posted losses.

News the U.S. futures market regulator, the Commodity Futures Trading Commission, was considering a clampdown on excessive speculation in commodities by restricting holdings of big players also hurt prices, dealers said.

“The CFTC announcement is definitely putting some pressure on metals, as well as on energy,” said one European precious metals trader.

The news prompted speculation that the approval of proposed U.S. platinum and palladium ETFs could be delayed until the CFTC had finished its deliberations.

“We do wonder whether the proposed U.S. listing of platinum and palladium ETFs – under consideration by the SEC at present – can possibly be approved until the CFTC’s investigations are concluded,” UBS strategist John Reade said in a note.

Palladium was at $234 against $239. Silver fell below $13 an ounce for the first time since May 5 to hit a low of $12.91. It was later at $12.95 an ounce against $13.10.

LONDON, July 8 (Reuters)