* Gold edges up, PGMs are at their highest in over 20 months
* Fresh fund money lifts commodities
(Updates prices and comments)
By Humeyra Pamuk
LONDON, April 1 (Reuters) - Gold rose on Thursday to a
two-week high and platinum group metals rallied to their highest
in over twenty months on the back of fresh investment money
poured into commodities, signalling another quarter of gains.
A shutdown this week of a smelter at the world's third
biggest platinum producer Lonmin <LMI.L>, has also buoyed
platinum to its highest since August 2008 and palladium to its
loftiest since March 2008. []
Bullion rose despite the currency markets, where the euro
<EUR=> was steady versus the dollar but the U.S. currency hit a
three-month high against the yen. []
Spot gold <XAU=> rose to $1,124.65 an ounce, its highest
since March 17 and was at $1,123.35 an ounce by 1324 GMT, versus
$1,112.80 an ounce late in New York on Wednesday.
"It's benefiting from the begining of the quarter with new
fund money and fresh buying coming in," said Jesper Dannesboe,
senior commodity strategist at Societe Generale.
Investor interest looked to be the theme across several
commodity markets, where copper touched a 20-month high and oil
rallied to an 18-month high. []
"Still not big volumes but enough to push it higher. Also
increasing the number of investors and speculators thinking that
'the base metals are going higher so maybe there's some upside
in gold'," he said.
Bullion ended the first quarter more than one percent higher
on buying driven by volatile currencies, firm stock markets and
oil as well as euro zone debt but it has struggled to sustain
gains since hitting a record above $1,200 an ounce last
December.
"Commodities as a group are extremely strong at the moment,"
said RBS metals analyst Stephen Briggs. "We had lots of
quarter-end massaging going on and that has set us up for
probably more money coming into commodities."
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For a factbox on how much commodities gained in the first
quarter, click on []
For a graphic on first quarter price performances, click:
http://graphics.thomsonreuters.com/310/CMD_Q1PRF0310.gif
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DOLLAR IS UP, SO IS GOLD!
Analysts look divided on gold's prospects as some believe
bullion's gains will be capped due to the strong outlook on the
dollar, while some believe that relationship is no longer valid.
"Gold versus euro/dollar is broken, if you look longer term.
It could be the case for intra-day movements maybe," Dannesboe
said. "We think this year dollar is going up and gold is going
up," he said.
U.S. gold futures for June delivery <GCM0> gained $3.3 an
ounce to $1,117.8 ounce. Gold traders also cited some physical
activity, which supported bullion.
Bullion markets in Singapore, Indonesia, India, Hong Kong
and Australia will be closed for Good Friday but Japan is open
and investors will be waiting for U.S. non-farm payrolls that
could set the tone for currencies.
Analysts are expecting the government payrolls report on
Friday to show the economy added 190,000 jobs in March, albeit
aided by temporary government hiring for the 2010 U.S. Census.
Spot platinum <XPT=> traded at $1,657 an ounce versus
Wednesday's $1,641.50 an ounce while palladium <XPD=> was at
$489 an ounce versus $477.50.
Palladium and platinum ended the first quarter 17 percent
and 12 percent higher respectively, surpassing the single-digit
gains posted by gold and silver.
"Obviously an accident at the Lonmin smelter helped but
actually it's more of a general sense that the market likes the
PGMs," Briggs said.
A recovering auto industry led by China is also another
factor boosting the PGM prices. More than half of the world's
output of platinum group metals is used in catalytic converters
which clean exhaust fumes from vehicles.
Silver <XAG=> was at $17.90 an ounce, after hitting $17.93
an ounce, its highest in ten weeks and versus Wednesday's $17.46
an ounce.
(Reporting by Humeyra Pamuk, Editing by Keiron Henderson)
