* Investors on alert for Fed moves
* Silver eyes 30-year highs above $21
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By Melanie Burton
LONDON, Sept 17 (Reuters) - Gold retreated from record highs
on Friday, as a firmer dollar tempered the momentum, although
concerns about further quantitative easing in the United States
cushioned prices.
Sister-metal silver <XAG> was supercharged, benefiting also
from gains in prices for industrial metals to test the $21 mark.
A break above $21.24 would open the way for prices to hit levels
last seen in October 1980. [].
Spot gold <XAU=> hit an all-time high of $1,282.75 a troy
ounce before easing to a bid at $1,276.50 by 1215 GMT, compared
with $1,272.20 late in New York on Thursday. It has gained more
than $100 or 8.4 percent since the start of August.
"It's partly a currency move. There's certainly investor
nervousness about monetary policy around the world since the yen
intervention," said precious metals strategist Matthew Turner of
Mitsubishi Corp.
"A lot of people are sensing a race to the bottom by central
banks to print more of their currency, to reflate their
economies and gold is getting support from that."
The dollar <.DXY> gained ground against the euro on Friday
on talk of an Irish bank in trouble, but remains close to
one-month lows against a basket of currencies.
Dollar sentiment overall has been damaged by speculation of
more quantitative easing from the U.S. Federal Reserve next
week. [] []
Quantitative easing is a process by which central banks
attempt to pump money into economies by printing money and
buying bonds. Excess liquidity can often lead to price pressures
as too much money chases too few goods and services.
A lower U.S. currency makes dollar-denominated commodities
cheaper for holders of other currencies. Investors use gold as a
store of value during times of high inflation or financial
market turmoil.
Holdings in the world's largest gold-backed exchange-traded
fund, SPDR Gold Trust <GLD.P>, were flat overnight at 1,294.746
tonnes, having fallen the day before. But earlier this week the
number rose by more than 6 tonnes.
The market shrugged off data that showed U.S. consumer
prices increased slightly more than expected in August as food
prices rebounded and energy costs remained elevate, but core
prices were flat. []
SEASONALLY STRONG
September and October are typically seasonally strong
periods for jewellery demand, with a number of small gold-buying
festivals in major consumer India, while Western manufacturers
stock up ahead of Christmas.
Lending background support this week however, was news of
AngloGold Ashanti's <ANGJ.J> capital raising, a key function of
which was to buy back its outstanding gold hedge. []
"They've raised the capital, but I haven't heard any strong
rumours (that they have bought any gold)," said analyst Robin
Bhar of Credit Agricole.
Spot silver <XAG=> was bid at $20.85 an ounce from $20.72 in
New York on Thursday.
"The last few months, silver has been benefiting as a
monetary metal like gold, when things are looking bad, and as an
industrial metal when things are looking good. So investors are
very keen," Mitsubishi's Turner added.
Expectations of stronger growth in the final few months of
this year has helped boost industrial precious metals platinum,
palladium and silver.
However, silver is according to technical analysis,
overbought and could be due a correction.
"Silver is renowned for overshooting and undershooting, so
this rally can get more exponential but we are already up 18
percent since late August," Kendall said.
"In my opinion, that kind of rate of increase can't be
sustained. I would not be recommending anyone to get long or
longer silver at $21."
Spot platinum <XPT=> hit $1,630 an ounce, its highest since
May 19. It was last at $1,619 from $1,603.65 on Thursday and
palladium <XPD=> was bid at $546.00 an ounce from $544.65.
(Editing by Sue Thomas)
