* Gold holds near NY levels, early buying subsides
* Investors await Bernanke's testimony this week
(Updates prices, adds quotes)
By Lewa Pardomuan
SINGAPORE, Feb 23 (Reuters) - Gold hardly moved on Tuesday
and hovered below a 1-month high hit the previous day as
uncertainty about the timing and pace of monetary tightening in
the United States drove off some investors.
Early bargain hunting pushed up the price of gold to more
than $1,115 an an ounce, but there was a lack of follow-through
as dealers awaited this week's testimony from the head of the
U.S. Federal Reserve, which could set the tone for the dollar.
Spot gold <XAU=> was at $1,113.45 an ounce by 0254 GMT,
down 15 U.S. cents an ounce, having rallied to its strongest in
a month at $1,130.65 on Monday before profit-taking kicked in.
Gold has rebounded from a 3-month low as investors sought a
safe haven from currencies' volatility, but it is still
struggling to sustain recent gains. Bullion was about 7 percent
below a lifetime high around $1,200 struck in early December.
"We think there is still scope for the dollar to rally
further on the back of uncertainties in Greece," said David
Barclay, commodity strategist at Standard Chartered in Hong
Kong.
"But given that gold has recently been resilient to dollar
strength and that correlations between the two have weakened,
this bodes well for gold if the dollar does bounce a little
further." The U.S. dollar consolidated on Tuesday with traders
on the sidelines on speculation the Fed would hose down talk of
early monetary tightening, but concerns about Greece's
indebtedness weighed on the euro. []
San Francisco Federal Reserve Bank President Janet Yellen
said the U.S. economy still needed extraordinary low interest
rates as inflation was "undesirably low", a view that could be
echoed by Fed Reserve chief Ben Bernanke in coming days.
Bernanke gives testimony to Congress on Wednesday and
Thursday.
"In the second half of the year we are forecasting a return
to the bearish trend in the dollar. Coupled with low real rates
and higher oil prices, that's why we still see gold averaging
$1,300 an ounce by Q4," said Barclay of Standard Chartered.
U.S. gold futures for April delivery <GCJO> added $2.2 an
ounce to $1,115.3 an ounce but it also hovered below Monday's
1-month high, with weaker oil prices likely to cap gains.
U.S. crude futures dropped to around $80 a barrel on
Tuesday after rising for five days, with some traders selling
to book profits on the new front-month contract. []
"There's bargain buying but we don't see any follow
through. Trading volume is very low and we don't see much
interest in the market," said a bullion dealer in Hong Kong.
"The Chinese are still in a holiday mood after the Lunar New
Year. They haven't really started doing any business. We are
going to be in a ranged market of between $1,100 and $1,130,"
The world's largest gold-backed exchange-traded fund, SPDR
Gold Trust <GLD>, said its holdings stood at 1,107.901 tonnes
as of Feb. 22, up 0.305 tonnes from the previous business day.
[]
PRICES
Precious metals prices at 0254 GMT
Metal Last Change Pct chg YTD pct chg
Turnover Spot Gold 1113.45 -0.15 -0.01 1.62
Spot Silver 16.20 0.00 +0.00 -3.74
Spot Platinum 1529.50 8.00 +0.53 4.26
Spot Palladium 435.75 -4.25 -0.97 7.46
TOCOM Gold 3269.00 -55.00 -1.65 0.31 37436
TOCOM Platinum 4480.00 -49.00 -1.08 2.26
7144 TOCOM Silver 48.10 -1.20 -2.43 -6.96
369 TOCOM Palladium 1279.00 -20.00 -1.54 9.79
202 Euro/Dollar 1.3606 Dollar/Yen 91.03
TOCOM prices in yen per gram. Spot prices in $ per ounce.
(Editing by Clarence Fernandez)
