* Weak gold jewelry demand spooks bullion investors
* Gold in tight range, moving closely with euro/dollar
* Strike threat at Impala Platinum in South Africa
(Recasts, updates with quotes, closing prices, adds NEW
YORK to dateline)
By Frank Tang and Jan Harvey
NEW YORK/LONDON, Aug 20 (Reuters) - Gold futures ended
lower amid light trading on Thursday as bullion investors
focused on beaten-down gold jewelry demand amid a global
downturn, but economic uncertainties also provided underlying
support to prices.
Analysts noted that the inverse relationship between gold
and the dollar has been reasserting itself. In addition, doubts
about a nascent economic recovery had prompted investors to
sell riskier assets like commodities and equities and opted for
the U.S. dollar and Treasury bonds.
"Gold is trading tick-to-tick with the euro-dollar. It is
mainly investment driven, as there is not a lot of physical
demand right now," said Bruce Dunn, senior vice president of
trading at New Jersey-based Auramet Trading.
World gold demand fell sharply in the second quarter, as
rising prices and the impact of the global recession curbed
jewelry consumption by 22 percent, an industry report showed.
Gold jewelry buying typically accounts for more than half of
the annual gold demand. []
However, worries about a double-dip recession and potential
economic problems are providing underlying support to gold
prices, Dunn says.
U.S. December gold futures <GCZ9> settled down $3.10 at
$941.70 an ounce on the COMEX division of the New York
Mercantile Exchange.
Spot gold <XAU=> at $940.55 an ounce at 2:30 p.m. EDT (1830
GMT), against $941.55 an ounce late in New York on Wednesday.
Earlier it rose as high as $945.60 an ounce.
"If you look at the euro/dollar today, you have less than a
half-a-cent trading range, and this is reflected in the
relatively quiet business in gold," said Wolfgang
Wrzesniok-Rossbach, head of sales at Heraeus.
"There is still investment demand for physical gold... but
on the other side, the industrial business and the jewelry
business is pretty dead," he said.
DEMAND ABATES
Gold demand in India, the world's biggest bullion consumer
last year, abated as domestic prices rose.
India's gold demand for the second quarter fell 38 percent
to 109 tonnes as weak economic conditions and high prices
continued to weigh on sentiment. Coins and jewelry buying also
tumbled.
Among other precious metals, silver rose rebounded nearly 1
percent as base metals rallied. The grey metal is widely used
in industry as well as being an investment asset. []
Spot silver <XAG=> was at $13.88 an ounce against $13.79.
Elsewhere, platinum <XPT=> was at $1,237.50 an ounce against
$1,234.50, while palladium <XPD=> was at $271.50 against $270.
The main South African miners' union said on Wednesday it
will strike next week at number two platinum miner Impala
Platinum. Implats said it hopes for further talks.
[]
Close Change Pct 2008 YTD
Chg Close Pct Chg
US gold <GCZ9> 941.70 -3.10 -0.3 884.30 6.5
US silver <SIU9> 13.880 0.005 0.0 11.295 22.9
US platinum <PLV9> 1242.00 0.60 0.0 941.50 31.9
US palladium <PAU9> 275.25 3.45 1.3 188.70 45.9
Prices at 2:30 p.m. EDT (1830 GMT)
Gold <XAU=> 940.55 -1.00 -0.1 878.200 7.1
Silver <XAG=> 13.89 0.10 0.7 11.30 22.9
Platinum <XPT=> 1237.50 3.00 0.2 924.50 33.9
Palladium <XPD=> 271.50 1.50 0.6 184.50 47.2
Gold Fix <XAUFIX=> 940.50 -2.50 -0.3 836.50 12.4
Silver Fix <XAGFIX=> 14.040 0.455 3.3 14.760 -4.9
Platinum Fix <XPTFIX=> 1241.00 0.00 0.0 1529.00 -18.8
Palladium Fix <XPDFIX=> 272.00 0.00 0.0 365.00 -25.5
(Reporting by Frank Tang and Jan Harvey; Editing by Marguerita
Choy)
