* Gold eases to $925 on firmer dollar; eyes Fed meeting
* Swiss move to weaken currency may affects market
* Holdings in SPDR Gold Trust up 1.5 pct at new record
(Updates prices)
By Miho Yoshikawa
TOKYO, March 16 (Reuters) - Gold edged down to around $925
an ounce on Monday, as the U.S. dollar's broad rise before this
week's Federal Reserve meeting dulled some of the precious
metal's allure as a currency hedge.
A rise in holdings for the world's largest gold-backed
exchange-traded fund to a new record high provided support,
highlighting continued investor interest in gold.
Gold <XAU=> was at $924.65 an ounce at 0542 GMT, down 0.3
percent from New York's notional close on Friday, after moving
between $922.50 and $927.95.
At current levels, bullion is down about 8 percent from an
11-month high above $1,000 hit last month.
Gold is down 1.3 percent compared with a week earlier,
after touching a one-month low below $900 last Tuesday.
"There doesn't seem to be any particular driver (for the
gold market) apart from the dollar," said Darren Heathcote,
head of trading at Investec Australia.
The dollar rose broadly on Monday, with the market looking
ahead to a Federal Reserve policy meeting this week after a
Group of 20 finance ministers' meeting at the weekend gave the
market few trading incentives. []
A stronger dollar typically weighs on gold, which is often
bought as a currency hedge, although the relationship has
weakened in recent sessions as both have benefited from
safe-haven buying because of the financial crisis.
Heathcote said news last week that the Swiss National Bank
had moved to rein in the franc's strength to boost the economy
would continue to be a factor in the market.
"That will certainly be adding to some of the uncertainty
that we've been experiencing and I guess that could mean
ultimately we'll see some effect of that on gold," he said.
News of the Swiss bank's move and fresh inflows into
exchange-traded funds helped gold's rise on Friday.
The Swiss National Bank sold its currency against the euro
last week, a move seen as opening the door to the use of
currencies as a policy tool. []
Central banks are seeking unconventional ways to boost
their economies now that many have interest rates at historic
lows.
The world's largest gold-backed exchange-traded fund, the
SPDR Gold Trust <GLD>, said holdings hit a record 1,056.82
tonnes on March 15, up 15.29 tonnes or 1.5 percent from the
previous day. []
In another sign of keen interest in gold, mints around the
world said demand for gold coins had risen sharply because of
financial instability and concerns over the inflation outlook.
[]
Non-commercial net long position in gold contracts eased to
144,788 on March 10 from 159,293 on March 3, according to the
weekly Commitments of Traders report issued by the Commodity
Futures Trading Commission. []
Precious metals prices at 0540 GMT
Metal Last Change Pct chg YTD pct chg
Turnover
Spot Gold 924.50 -2.70 -0.29 5.04
Spot Silver 13.02 -0.15 -1.14 15.02
Spot Platinum 1060.00 5.50 +0.52 13.73
Spot Palladium 196.00 -0.50 -0.25 6.23
TOCOM Gold 2929.00 9.00 +0.31 13.84
26168
TOCOM Platinum 3353.00 39.00 +1.18 26.43
5251
TOCOM Silver 408.50 1.90 +0.47 27.94
213
TOCOM Palladium 630.00 -1.00 -0.16 14.55
161
Euro/Dollar 1.2893
Dollar/Yen 98.16
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 Chikako Mogi; Editing by Ben Tan)
