* Gold extends losses on falling oil, hits 1-week low
* Platinum drops 2 percent on fears of falling demand
(Updates prices, adds quotes)
By Lewa Pardomuan
SINGAPORE, Sept 2 (Reuters) - Gold fell to its lowest level
in a week on Tuesday as speculators ditched some holdings
following a sharp drop in oil prices and a rally in the U.S.
dollar, which reduced the metal's appeal as an alternative
investment.
Platinum also fell to a one-week low on concerns about
demand for autocatalysts due to poor car sales and a slowing
U.S. economy. Autocatalysts, used to clean exhaust fumes,
account for more than 50 percent of global platinum demand.
Gold <XAU=> fell to $814.35/815.35 an ounce from
$817.15/818.75 an ounce late in London. New York markets were
closed on Monday for the Labor Day holiday.
Gold has lost more than 20 percent in value since spiking
to all-time high of $1,030.80 in March, mainly driven by profit
taking, oil's falls from record highs and a rebounding dollar.
"The movements in the oil prices and the U.S. dollar have
both conspired against gold," said David Moore, analyst at
Commonwealth Bank of Australia in Sydney.
Oil <CLc1> futures steadied above $111 a barrel after
slumping more then $4 on Monday as concerns Hurricane Gustav
would cause lasting damage to the U.S. oil sector eased after
the storm weakened before hitting the Louisanacoast. []
In theory, weak oil prices reduce gold's appeal as a hedge
against inflation.
"I do think there's a potential for a bounce in the oil
price in the short-term. It probably needs something to sort of
turnaround, to give it some assistance," said Moore.
"One thing that might be relevant to oil markets going
forward is the OPEC meeting on September 9," said Moore,
referring to the gathering in Vienna to discuss output policy.
Spot platinum <XPT=> dropped to $1,410.00/1,430.00 an ounce
from $1,439.00/1,451.00 late in London, having hit an intraday
low of $1,401.50 an ounce.
"Japanese sales of automobiles in August were below 200,000
cars, so it's very bad figure. Platinum price is under
pressure. It's a very bearish factor," said Kazuhiko Saito of
Interes Capital Management in Tokyo.
Saito pegged platinum's downside target at $1,350 an ounce
- a level last seen in late August, while gold could
potentially fall to $800.
Automobile sales in Japan, excluding 660cc minivehicles,
tumbled 14.9 percent in August year-on-year to 193,902
vehicles, the Japan Automobile Dealers Association. Sales for
August fell short of 200,000 vehicles for the first time in 37
years. []
Platinum prices have taken a dramatic turn since spiking to
a record high above $2,000 an ounce in March, losing much of
their gains to profit taking and fears of falling demand.
The benchmark platinum contract on the Tokyo Commodity
Exchange, August 2009 <JPLc6>, ended the morning sesion 128 yen
per gram lower at 4,857 yen, with weaker oil prices adding to
the selling pressure.
The dollar index <.DXY> climbed 0.8 percent to 77.75 after
hitting an eight-month high of 77.823.
New York gold futures <GCZ8> lost $16.30 an ounce to
$818.90.
Spot palladium <XPD=> fell to $288.50/296.50 an ounce from
$297.00/305.00 an ounce. Silver <XAG=> edged down to
$13.32/13.38 an ounce from $13.40/13.46 an ounce late in
London.
Precious metals prices at 0217 GMT
Metal Last Change Pct chg YTD pct chg
Turnover
Spot Gold 813.75 -3.35 -0.41 -2.28
Spot Silver 13.32 -0.09 -0.67 -9.82
Spot Platinum 1410.00 -29.00 -2.02 -7.24
Spot Palladium 288.50 -9.50 -3.19 -21.60
TOCOM Gold 2855.00 -48.00 -1.65 -6.70
21443
TOCOM Platinum 4857.00 -128.00 -2.57 -9.03
9412
TOCOM Silver 467.70 -10.40 -2.18 -13.55
400
TOCOM Palladium 1028.00 -52.00 -4.81 -23.91
393
Euro/Dollar 1.4584
Dollar/Yen 108.14
TOCOM prices in yen per gram, except TOCOM silver which is
priced in yen per 10 grams. Spot prices in $ per ounce.
(Editing by Kim Coghill)
