* Economic data to dictate gold's move in short term
* Spot gold to extend gains to $1,367/oz - technical
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(Updates prices)
By Rujun Shen
SINGAPORE, Oct 11 (Reuters) - Spot silver reached a 30-year
high and gold was firm on Monday after disappointing U.S.
payrolls data underpinned hopes of more stimulus from the
Federal Reserve, spurring interest in precious metals.
The U.S. economy shed jobs for a fourth straight month in
September, hit by government layoffs and slower private hiring.
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"In the short term, gold will still look at the economic
picture. If economic data turns out weaker than expected, it
will raise expectations of quantitative easing, which will be
positive for gold," said Ong Yi Ling, an analyst at Phillip
Futures.
Continuous weakness in the U.S. dollar also lent support to
bullion. The dollar slid to 15-year lows versus the yen on
Monday on the soft jobs data, while the IMF and G7 meetings
produced nothing to avert a cycle of competitive depreciation.
[]
Spot gold <XAU=> rose 0.7 percent to $1,352.65 an ounce by
0610 GMT. It hit an all-time high of $1,364.60 last week.
U.S. gold futures for December delivery <GCZ0> were up 0.6
percent at $1,353.9.
Gold may rise to $1,367 an ounce, as a bullish pennant has
been confirmed, said Wang Tao, a Reuters market analyst.
http://graphics.thomsonreuters.com/WT/20101110080154.jpg
Gold output in China, the world's largest gold producer,
fell 11 percent on the month to 27.655 tonnes in August, but
total production in the first eight months gained 8.85 percent
from a year earlier. []
"Physical demand is on the rise, as investors swarm into
the gold market, betting on a further price rally," a
Beijing-based trader said, but added that the rising Chinese
yuan has been curbing the rise in domestic gold prices.
China's central bank set the yuan's daily mid-point against
the dollar at a record high on Monday. []
Spot silver <XAG=> rose to a 30-year high of $23.65 an
ounce, before easing to $23.39, gaining nearly 39 percent so
far this year, outperforming gold's 23 percent rally.
"As long as gold prices hold firm, prices of other precious
metals, such as silver, will actually outpace gold, thanks to
increasing investment interest," said Ong of Phillip Futures.
"For silver, we are also likely to see increaing demand on
the physical side from emerging economies, such as China, both
on the industrial and investment sides."
The gold-silver ratio, used to measure how many ounces of
silver are used to buy an ounce of gold, dropped to its lowest
in more than two years at 57.83. For a graphic on the ratio,
click:
http://graphics.thomsonreuters.com/AS/0810/RS_20101110113030.jp
g Holdings in iShares Silver Trust <SLV>, the world's
largest
silver-backed exchange-traded fund, rose to a five-digit
figure for the first time, standing at 10,085.62 tonnes by Oct.
8.
Precious metals prices at 0610 GMT
Metal Last Change Pct chg YTD pct chg
Turnover
Spot Gold 1352.65 9.40 +0.70 23.45
Spot Silver 23.39 0.19 +0.82 38.98
Spot Platinum 1703.50 4.15 +0.24 16.12
Spot Palladium 587.50 3.97 +0.68 44.88
Euro/Dollar 1.3961
Dollar/Yen 82.03
Spot prices in $ per ounce.
(Editing by Michael Urquhart)
