* Gold hit by dollar rise as Fed unlikely to extend QE2
* Technical selling hit prices after Thursday's reversal
* Renewed euro zone debt worries, Mideast violence support
* Coming up: U.S. personal income on Monday
(Rewrites, updates market activity, adds graphic, comment,
NEW YORK to dateline)
By Frank Tang and Jan Harvey
NEW YORK/LONDON, March 25 (Reuters) - Gold reversed gains
in high volume on Friday, hit by a dollar spike after several
top Federal Reserve officials said the Fed is unlikely to
extend its bond-buying stimulus program beyond a planned $600
billion.
Bullion lost nearly 2 percent following a brief rally to an
all-time high $1,447.40 on Thursday, but the metal is set to
post a small gain for the week as Portugal's credit downgrade
and escalating political unrest in the Arab world underpinned
safe-haven demand.
"After the key technical reversal yesterday, when we could
not turn around and blow through the record high, everybody
started heading for the door at the same time," said Frank
McGhee, head precious metals trader of Integrated Brokerage
Services.
(Graphic: http://link.reuters.com/kud78r)
Spot gold <XAU=> dropped 0.2 percent to $1,426.85 an ounce
by 1:07 p.m. EDT (1707 GMT). U.S. gold futures for April
delivery <GCJ1> lost 0.5 percent to $1,427.40.
COMEX gold was one of the few actively trading commodity
markets with volume already topping 210,000 contracts, set for
the heaviest trading day in the last two months.
Members of the more hawkish wing of the Fed, including
Philadelphia Fed Bank President Charles Plosser said the U.S.
central bank will have to reverse its easy money policy in the
"not-too-distant future" to avoid sowing the seeds of inflation
with the U.S. economy on firmer footing.
Gold investors now look forward to next week's heavyweight
economic indicators, including Friday's nonfarm payrolls
report, Wednesday's ADP private-sector job data and Thursday's
factory orders.
Silver <XAG=> lost 0.2 percent to $37.06 an ounce, having
retreated from the previous session's 31-year high at $38.13 an
ounce. Holdings of the largest silver ETF, the iShares Silver
Trust <SLV>, leapt to a record 11,140 tonnes on Thursday.
Platinum <XPT=> dropped 0.4 percent to $1,741.24 an ounce,
while palladium <XPD=> fell 0.2 percent to $747.47.
Prices at 1:07 p.m. EDT (1707 GMT)
LAST NET PCT YTD
CHG CHG CHG
US gold <GCJ1> 1427.30 -7.60 -0.5% 0.4%
US silver <SIK1> 37.115 -0.260 -0.7% 20.0%
US platinum <PLJ1> 1745.00 -15.00 -0.9% -1.9%
US palladium <PAM1> 750.55 -1.70 -0.2% -6.6%
Gold <XAU=> 1426.85 -2.14 -0.2% 0.5%
Silver <XAG=> 37.06 -0.06 -0.2% 20.1%
Platinum <XPT=> 1741.24 -7.76 -0.4% -1.5%
Palladium <XPD=> 747.47 -1.50 -0.2% -6.5%
Gold Fix <XAUFIX=> 1436.00 2.00 0.1% 1.8%
Silver Fix <XAGFIX=> 37.68 -10.00 -0.3% 23.0%
Platinum Fix <XPTFIX=> 1752.00 6.00 0.3% 1.2%
Palladium Fix <XPDFIX=> 754.00 5.00 0.7% -4.7%
(Reporting by Frank Tang and Jan Harvey;editing by Sofina
Mirza-Reid)
