Dollar bounce triggers gold fall

By Al Yoon

NEW YORK (Reuters) - Gold retreated from a record high above $1,120 an ounce on Thursday and global stocks lost ground as doubts about a lasting economic recovery underpinned the dollar.

Stocks slumped as the U.S. dollar strengthened against other currencies, also on technical factors.

The yellow metal pushed to a record high on the momentum of months of dollar weakness, only to drop $15.35 to $1,102.40 as the currency recovered. A weak greenback makes metals priced in dollars less expensive for holders of other currencies.

Gold's rally from near $800 an ounce in January and the upcoming yearend also prompted investors to book profits.

"Gold's weakness (on Thursday) was a reflection of profit-taking after the metal's recent impressive run," said Peter Buchanan, commodities analyst at CIBC.

The dollar also rose after the euro failed to break through and hold above the psychologically important 1.50 level. The euro declined 0.92 percent to $1.4843. The dollar rose 0.56 percent against the Japanese yen, to 90.32 yen.

Prospects that U.S. interest rates will remain at negligible levels for some time are expected to continue weighing on the dollar. It rebounded 0.67 percent against a basket of major currencies on Thursday but is still down nearly 1 percent this month and 14.5 percent since early March.

With a light economic data calendar on Thursday, apart from strong Australian jobs numbers that boosted the Aussie dollar to a 15-month high, the broader market consolidated.