LONDON, June 16 (Reuters) - Gold rose in Europe on Tuesday, recovering some of the previous session's losses, as the dollar fell broadly and a rebound in oil prices boosted bullion's appeal as a hedge against potential oil-induced inflation.

The dollar slipped against a basket of currencies after Russia said the world needed new reserve currencies, while the euro extended gains after a strong reading of German economic sentiment. [FRX/]

Oil firmed towards $72 a barrel as the dollar weakened. Gold prices often track those of crude, as the metal can be bought as a hedge against inflationary pressures sparked by higher oil prices. [O/R]

Spot gold was bid at $935.20 an ounce at 1122 GMT, against $927.85 an ounce late in New York on Monday.

"The dollar has reversed a bit," said Mitsubishi analyst Tom Kendall. "(Gold) has not really put on much of a push, it is kind of struggling right now in the mid $930s."

Kendall said gold was likely to move sideways as investors awaited direction from U.S. data due later in the day, including housing starts and industrial production data.

"The markets are going to be cautious about any surprises from those numbers," he said.

"If industrial production comes in weaker than expected then I think we'll see oil reverse and head lower...and you would expect that to have an impact on precious metals."

Gold has slipped sharply from the three-month high of $989.80 it hit earlier this month, as a dollar rally dampened investors' interest in gold and made dollar-priced commodities more expensive for holders of other currencies.

MARKET RISKS

Stock markets edged higher in Europe, while U.S. stock futures pointed to a flat start on Wall Street. [MKTS/GLOB]

VTB Capital analyst Andrey Kryuchenkov said gold's drop alongside falling global equities markets on Monday could mean the precious metal's attractiveness as a hedge against market risks had diminished dramatically.

"It is now clear that the buying momentum in gold could only have a significant recovery on the back of rising inflation expectations and a tumbling dollar," he said in a note.

Among other precious metals, silver rose to $14.29 an ounce against $14.05.

Platinum was at $1,227.50 an ounce against $1,204, while palladium was at $245.00 against $240.50. Both are, like gold, tracking the dollar and overall interest in commodities.

Interest in platinum exchange-traded funds -- which issue securities backed by metal -- remains firm, with the ETFS Physical Platinum fund up another 3,000 ounces or nearly 1 percent on Monday.

"(Platinum) should find further support ahead of $1200 from bargain hunters, as reflected by the increase in ETF holdings," said James Moore, an analyst at TheBullionDesk.com.

The metals remain pressured, however, by fears over the outlook for carmakers, their main buyers. New car registrations in Europe fell for a 13th month in May as companies struggled to make sales without government incentives.