* Gold rises for fourth straight day on oil, euro
* Oil up more than $2, dollar extends decline vs euro
* Despite gains, on track for worst month since 1983
(Updates prices)
By Lewa Pardomuan
SINGAPORE, Oct 30 (Reuters) - Gold rose for a fourth
straight day to near a 1-week high on Thursday on safe-haven
buying after oil extended gains and the U.S. dollar posted its
biggest one-day drop in 23 years.
Firmer equities also lifted gold and other precious metals,
with silver and palladium rising to their highest in two weeks
and platinum hitting a 1-week high. The U.S. Federal Reserve
cut interest rates by half a percentage point on Wednesday,
sending the U.S. dollar tumbling.
Thursday's third-quarter U.S. GDP data, expected to show
the economy contracted by 0.5 percent, could also set the
direction for precious metals.
Gold <XAU=> was trading at $765.50 an ounce, up $11.20 an
ounce from New York's notional close on Wednesday, when it hit
an intraday high of $773.40 an ounce.
But is is still down nearly 12 percent since the start of
the month, on track for its biggest monthly decline since 1983,
as an earlier rush for safe-haven assets gave way to a
cross-commodity sell-off by investors scrambling for cash.
Gold plummeted to its weakest in 13 months at $680.80 on
Friday, but has rallied since then along with a recovery in
other commodity markets, raising hope that the worst may be
behind.
"I think all the preconditions are there for gold to take a
very healthy run. The physical demand for gold has actually
exceeded the ability to supply right around the world," said
Ian Smith, managing director of Newcrest Mining Ltd <NCM.AX>,
Australia's largest gold producer.
It has bounced on strong oil, a recovery in equities, a
firmer euro and tightness in physical gold supply after a
recent drop in prices triggered buying from jewellers and
investors.
"My view is that we're likely to see the gold price
continue to move higher in the near term," said David Moore,
commodities analyst at Commonwealth Bank of Australia in
Sydney.
"I mean it'll probably follow a fairly uneven path but the
underlying trend is for gold to be back above $800 an ounce by
the end of this year," he said.
Gold, which traded around $800 earlier this month, was
still below a record high of $1,030.80 hit in March after a
rally to a two-month high of $931 on Oct. 10 was met by heavy
selling.
Oil <CLc1> jumped $3 on dollar weakness and OPEC's comments
about a possible additional cut in supply, which in theory
boosts gold's appeal as a hedge against inflation. []
The dollar saw its biggest one-day drop in 23 years <.DXY>
on Wednesday after the U.S. rate cut eased investor concerns
about the world economy and reduced the need to repatriate
dollars from riskier assets.
"The dollar seems to be on the downside and that helps
gold. But I would say gold will still be trading in a very wide
range of $700 to $800 an ounce," said a dealer in Hong Kong.
Japan's Nikkei average rallied 10 percent on a weaker yen
and bargain hunting. [].
Platinum <XPT=> was trading at $820.50 ounce, up $27.00
from New York's notional close.
New York gold futures <GCZ8> added $12.3 an ounce to
$766.3.
Precious metals prices at 0616 GMT
Metal Last Change Pct chg YTD pct chg
Turnover
Spot Gold 765.50 11.20 +1.48 -8.07
Spot Silver 10.06 0.24 +2.44 -31.89
Spot Platinum 820.50 27.00 +3.40 -46.02
Spot Palladium 198.00 3.50 +1.80 -46.20
TOCOM Gold 2426.00 90.00 +3.85 -20.72
59316
TOCOM Platinum 2631.00 147.00 +5.92 -50.72
16289
TOCOM Silver 316.20 30.90 +10.83 -41.55
1244
TOCOM Palladium 650.00 65.00 +11.11 -51.89
594
Euro/Dollar 1.3140
Dollar/Yen 98.25
TOCOM prices in yen per gram, except TOCOM silver which is
priced in yen per 10 grams. Spot prices in $ per ounce.
(Additional reporting by Simone Giuliani; Editing by Michael
Urquhart)
