PRECIOUS-Gold prices fall 1 pct as Ukraine tensions ease

    * Putin orders troops in western Russia back to base 
    * Gold pulls back from 4-month high, remains underpinned 
    * India trade minister suggests easing curbs on gold imports 
 
 (Updates throughout, changes dateline, previous SINGAPORE) 
    By Jan Harvey 
    LONDON, March 4 (Reuters) - Gold prices fell 1 percent on 
Tuesday, retreating from the previous day's four-month high, 
after President Vladimir Putin ordered troops involved in a 
military exercise in western Russia back to base, easing fears 
of war in Ukraine. 
    The precious metal rallied nearly 2 percent on Monday as the 
threat of escalating tensions in Ukraine's Crimea region spurred 
investors to seek refuge in bullion and government debt. Crude 
oil futures climbed while stock markets plunged. 
    Those moves went into reverse early on Tuesday, with world 
shares and hard-hit Russian assets recovering some lost ground 
as immediate tensions in the East-West crisis over Ukraine 
abated.  MKTS/GLOB  
    There was no word, however, on Russian forces that have 
effectively occupied much of Crimea, and financial assets failed 
to retrace the entirety of the sharp moves seen globally on 
Monday. 
    Spot gold    fell as low as $1,336.54 an ounce and was 
down 0.8 percent at $1,339.70 by 1036 GMT. U.S. gold futures 
   for April delivery were down $10.50 an ounce at 
$1,339.80. 
    "Gold's moves are clearly headline-driven," Commerzbank 
analyst Daniel Briesemann said. "What we're seeing this morning 
is profit-taking after gold yesterday reached a four-month high 
on the back of increasing tensions between Russia and Ukraine." 
    "The conflict looks like it could well last some time, so 
gold should be able to defend its current price level." 
    Putin declared at the weekend that he had the right to 
invade Ukraine to protect Russian interests and citizens 
following months of popular unrest. Russia's Black Sea Fleet has 
a base in Ukraine's Crimea region.    
    But the military exercises in central and western Russia, 
which raised fears that Russia might send forces to 
Russian-speaking regions of east Ukraine, were completed on 
schedule. 
    Gold remains up nearly 1 percent this week, having reached 
its highest since Oct. 30 on Monday at $1,354.80 an ounce.  
    However, its gains could be vulnerable to economic data 
releases later this week, VTB Capital analyst Andrey Kryuchenkov 
said, including ADP jobs figures on Wednesday, a statement from 
the European Central Bank on Thursday, and U.S. nonfarm payrolls 
on Friday. 
    "Gold is a sell ahead of macro headlines this week, bar 
geopolitical tensions, with an overhang of speculative longs, 
easing physical flows and a potentially stronger dollar," he 
said.  
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    GRAPHIC-2014 metal returns:  http://link.reuters.com/cag37s 
    GRAPHIC-2014 commod returns: http://link.reuters.com/reb25t 
    GRAPHIC-Gold/platinum ratio: http://link.reuters.com/xez92s 
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    CONSUMER DEMAND SOFTENING  
    In the physical market, dealers in Singapore noted selling, 
which kept premiums for gold bars unchanged at 80 cents to $1 an 
ounce to spot London prices. 
    "The current price premiums ... show that consumer demand is 
tapering," said Joyce Liu, investment analyst at Phillip Futures 
in Singapore. 
    Weakening differentials between 99.99 percent purity gold 
   on the Shanghai Gold Exchange and cash gold were 
likely to crimp demand from China.  
    India's trade minister said on Tuesday he had raised the 
issue of easing some curbs on gold imports with the finance 
ministry, as the restrictions were encouraging smuggling and 
hurting the gems and jewellery industry.    
    India lost its spot as the world's biggest gold consumer to 
China last year, after the government imposed the restriction on 
imports to narrow the current account deficit. 
    Among other precious metals, silver    was down 0.5 
percent at $21.28 an ounce, while spot platinum    was down 
0.5 percent at $1,447.99 an ounce and spot palladium    was 
down 0.2 percent at $744.60 an ounce. 
    South Africa's Association of Mineworkers and Construction 
Union on Tuesday lowered its wage demands for the first time, 
raising hopes of a breakthrough after nearly six weeks of 
strikes at the world's top platinum producers.    
 
 (Additional reporting by Lewa Pardomuan in Singapore; Editing 
by Dale Hudson) 
 ((jan.harvey@thomsonreuters.com)(+44)(0)(207 542 7744)(Reuters 
Messaging: jan.harvey.thomsonreuters.com@reuters.net)) 
 
Keywords: MARKETS PRECIOUS/