* Gold rises 1.5 pct as dollar hits session low, oil climbs
* Coming Up: U.S. Fed interest rate statement at 1815 GMT
* Gold/silver ratio slips to lowest since Jan. 25
(Releads, updates prices)
By Jan Harvey
LONDON, March 16 (Reuters) - Gold rose nearly 1.5 percent on
Tuesday as Standard & Poor's' affirmation of its ratings on
Greece lifted the euro and U.S. stocks to session highs, and as
oil rallied ahead of a Federal Reserve rates announcement.
Spot gold <XAU=> hit a high of $1,126.25 an ounce and was
bid at $1,122.15 an ounce at 1532 GMT, against $1,108.10 late in
New York on Monday.
U.S. gold futures for April delivery <GCJ0> on the COMEX
division of the New York Mercantile Exchange rose $17.00 to
$1,122.40 an ounce.
All eyes are now on the Fed. Most commentators expect the
bank to leave interest rates at record lows, but its
accompanying statement will be closely watched for clues as to
the timing of a U.S. rate hike.
"Investors are likely to scrutinize the statements and (look
for) any absence of the wording 'rates will stay exceptionally
low for an extended period'," said Pradeep Unni, senior analyst
at Richcomm Global Services.
"If these words are absent, the Fed's intentions would be
clear to the markets and the downward spiral should begin (for)
gold, with momentum picking up beyond $1,100."
Gold is sensitive to suggestions U.S. interest rates may
rise, which could benefit the dollar and raise the opportunity
cost of holding non-interest bearing assets like bullion.
Gold usually moves in the opposite direction to the dollar,
as the unit's strength curbs its appeal as an alternative asset
and makes dollar-priced commodities more expensive for holders
of other currencies.
The euro extended gains versus the dollar on Tuesday to hit
a session high after Standard & Poor's affirmed its ratings on
Greece, lifting gold. [] []
Concern over the fiscal health of the debt-laden country has
helped support safe-haven flows into gold this month. The metal
continues to benefit from fears over the sovereign debt of major
economies like the UK and the United States. []
"The alternative to investment in bonds, given the U.S. TIC
flows yesterday, is supporting the market for now," Saxo Bank
senior manager Ole Hansen said, indicating data showing foreign
investors were net sellers of U.S. securities in January.
OIL JUMPS 2.5 PCT
Among other commodities, U.S. crude oil futures rose more
than $2 a barrel as the dollar weakened, equities rose and
markets awaited results of the Fed policy meeting. []
On the physical market, premiums for gold bars in Asia
jumped to their highest in more than a month as jewellers
restocked and demand from main consumer India started to pick up
ahead of the wedding season, dealers said on Tuesday. []
India's retail gold buying continued on Tuesday as prices
stayed in the vicinity of their recent lows, prompting consumers
to buy for the new year festivals of Gudi Padwa in Maharastra
and Ugadi in Karnataka, traders said. []
Among other precious metals, silver <XAG=> was at $17.34 an
ounce against $17.05, outperforming gold. The gold-silver ratio
dropped to a seven-week low of 64.46 on Tuesday, meaning silver
is increasingly expensive compared with gold.
VTB Capital analyst Andrey Kryuchenkov said in a note that
silver was benefiting both from hopes industrial demand will
pick up as the economy improves, and from investment interest.
Platinum group metals benefited from gold's strength, with
platinum <XPT=> hitting a seven-week high at $1,627 an ounce
before easing back to $1,621 an ounce against $1,620.50, and
palladium <XPD=> was at $465.50 against $461.
(Reporting by Jan Harvey; Editing by Keiron Henderson)
