Gold turned lower on Thursday, pulling back after having touched a high at $1140.80, as the euro may face further selling pressure as the European Central Bank’s kept the interest rates steady at 1% record low.

The European Central Bank on Thursday said its Governing Council left the key lending rate unchanged at a historic low of 1%. The decision was expected. The ECB withholds further rate reductions as growth remains crippled, while inflation rates are still below the bank’s set target rates of 2% in the 16-nation region.

The dollar gained versus the euro Thursday, derived by a weaker tone in equity markets that tends to signal risk aversion but trapped in a tight trading range. The currency pair remains trapped in a stalemate between support at $1.4800 and resistance at $1.5050.

European Central Bank President Trichet on Tuesday backed comments by U.S. Federal Chairman Ben Bernanke on Monday about the importance of a strong dollar, helping to stress international concern about the U.S. currency.

The euro zone’s ECB released its monthly report for November; revising upwards economic growth for this year and 2010 from the previous predictions in August that inflation will rebound in the upcoming months, while assuring that current interest rates of 1.00% are appropriate.

The US currency remains under downward pressure. The negative impact of last week’s disappointing labor market report on the markets was only short-lived. Some commentators were actually of the opinion that the job losses were boosting equity markets and weighing on the dollar, arguing that the weak labor market is enabling the Fed to continue to maintain its expansionary monetary policy.

As widely expected the ECB held rates steady today at their historic record low of 1.0% while withholding their bond purchase program as is. Expectations were all for that same scenario, but all the attention was to the conference following this decision.

Europe’s two leading central banks are expected to keep interest rates unchanged Thursday and damp down any talk that borrowing costs will soon rise in the wake of a surprise rate hike by Australia’s central bank to lift rates.

The dollar fell against the Japanese yen recording a low of 89.65 and a high of 90.40. A report today showed that Japan’s industrial production rebounded in August that helped the yen to rally against major currencies. The pair is having a support at 89.15 along with a resistance at 90.45. Also, the dollar fell on speculation a Federal Reserve official will reiterate today that record-low interest rates will be unchanged for an extended period. As with the global economy quite weak and inflation low a raise in US interest …