* Hit highest since June on Monday on safe-haven demand
* Next test is $1,200 an ounce
* Silver, platinum also near multi-month peaks
(Updates throughout, changes dateline to LONDON from MANILA)
By Susan Fenton
LONDON, Feb 9 (Reuters) - Gold steadied on Tuesday, after
touching its highest level in more than seven months the
previous day as rising concerns about the global economic
outlook hammered shares and sent investors rushing into safer
assets.
While those concerns persisted, European shares stabilised
and gold saw some profit taking after failing to push through
key resistance at $1,200 an ounce.
Spot gold was trading at $1,187.6 an ounce, down 0.3
percent, by 0925 GMT, after rising to $1,200.60 on Monday, its
strongest since June 22 last year.
Gold has gained more than 6 percent since the start of last
week on rising demand for assets deemed to be less risky.
"For the time being we continue to see the safe-haven demand
being supportive for gold. The next key level is $1,200 but it
is looking in overbought territory," said Citigroup (N:C) analyst
David Wilson. "We suggest it consolidates (first) between $1,150
and where we are now."
Strong demand for safe assets was underscored on Tuesday
when the yield on Japan's benchmark 10-year government bond
turned negative for the first time as the Nikkei stock index
.N225 tumbled more than 5 percent, its biggest daily drop in
nearly three years.
The Japanese yen, also seen as a safe haven, reached its
highest against the dollar JPY= since November 2014.
Fears that the global economy could slow sharply, or even
tip into recession, and worries about some banks have battered
share markets in recent days. European shares, however, were
steadier on Tuesday with the pan-European FTSEurofirst 300
.FTEU3 , which slumped 3.4 percent on Monday, up 0.3 percent.
U.S. gold for April delivery GCcv1 was down 0.7 percent at
$1,189 an ounce.
Underlining gold's rising appeal, holdings in eight major
gold exchange-traded funds (ETFs) HLDTOTALL=XAU rose to 43.3
million ounces on Friday, the highest since July 2015.
More significant was the rapid pace of inflows since the
start of the year, having risen more than 8 percent and the
biggest five-week surge since March 2011.
"We remain quite upbeat on gold's prospects over the short
term given the continued unease surrounding the global equity
markets, the weaker dollar and gold's much stronger technical
profile," INTL FCStone analyst Edward Meir said in a note.
The next stop for gold could be $1,205/$1,215 and further to
$1,235, said Meir.
China's markets are closed for the Lunar New Year holiday
this week, dampening demand for gold.
Spot silver XAG= was up 0.1 percent at $15.32 an ounce,
near Monday's three-month high of $15.46. Platinum XPT= was
down 0.3 percent to $923.31 an ounce, also near a three-month
peak of $931.76 reached overnight. Palladium XPD= slipped 0.2
percent to $512.15 an ounce.