* Gold holds firm after run of record highs, eyes $1,300/oz
* Dollar lifts from lows but stays under pressure after Fed
* Gold-silver ratio remains near lowest since January
(Updates throughout, changes dateline, pvs SINGAPORE)
By Jan Harvey
LONDON, Sept 23 (Reuters) - Gold held near record highs on
Thursday, eyeing a breach of $1,300 an ounce, while silver
flirted with 30-year peaks as the threat of currency devaluation
lifted interest in the metals as a safe store of value.
Spot gold <XAU=> was bid at $1,291.85 an ounce at 0939 GMT,
against $1,289.60 late in New York on Wednesday. U.S. gold
futures for December delivery <GCZ0> rose 60 cents to $1,292.70.
Silver <XAG=> rose to a 2-1/2 year high at $21.21 an ounce
-- within a few cents of its highest since 1980 -- and was later
bid at $21.07 an ounce against $21.11.
Gold prices were lifted to a record $1,296.10 on Wednesday
after the U.S. Federal Reserve indicated it was open to
reintroducing quantitative easing to tackle sluggish U.S.
economic growth, knocking the dollar.
"In its Sept 12 meeting, the FOMC indicated that the current
sub-par U.S. economic growth needs to improve, re-iterating its
commitment to further quantitative easing if this was not the
case," said BNP Paribas analyst Anne-Laure Tremblay.
"The FOMC announcement was positive for gold, and by
extension silver, with both metals rising sharply."
"If gold could dip on short-term profit taking, its outlook
remains strong in light of QE implications in terms of dollar
weakness and longer term inflation expectations," she said.
The dollar edged off lows on Thursday but stayed on the
defensive as speculation that the Federal Reserve will soon
start printing more money drove down Treasury yields and kept
the unit near a five-month low versus the euro. []
While the slight recovery in the U.S. currency is keeping a
lid on further gains in gold, the threat of further monetary
easing is providing good support to prices.
"Heightened fears of the currency debasement that could
result from an expanding Fed balance sheet, the potential for
the Bank of England to follow suit, and last week's yen
intervention all compound gold's medium-term allure," said UBS
analyst Edel Tully in a note.
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For a graphic showing gold's price performance versus its
inflation adjusted highs, click on:
http://graphics.thomsonreuters.com/F/09/GLD_PRCINF0910.gif
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TECHNICAL PICTURE FIRM
From a technical perspective, gold remains firm after
hitting record highs for five consecutive sessions to Wednesday.
"$1,300 should be a pivot and natural area for the market to
take profits but overall, the all-time new highs are holding, as
is our bullish bias and focus," said technical analysts at
Barclays Capital in a note. "$1,258/71 should now be support."
High prices curbed some physical buying, however. Indian
gold demand remained weak for a second day as prices traded near
all-time highs, but dealers said underlying buying was strong on
expectations of higher festive demand. []
On the supply side of the market, South Africa's Gold Fields
<GFIJ.J>, the world's fourth-largest gold miner, said it expects
attributable gold output for the September quarter to increase
0.9 percent to 906,000 ounces compared with the previous
quarter.
It added that it was on track to achieve its annual
production guidance of 3.5-3.8 million ounces. []
Among other precious metals, silver remained well supported
after hitting another 2-1/2 year high overnight in Asia.
The gold-silver ratio -- the number of ounces of silver
needed to buy an ounce of gold -- was at 61.25 on Wednesday,
having hit its lowest since January in the previous session.
Platinum <XPT=> was at $1,628 an ounce against $1,627.10,
while palladium <XPD=> was at $540 against $538.25.
(Reporting by Jan Harvey; Editing by Alison Birrane)
