* BoE slashes rates by 150 bps, SNB unexpectedly cuts 50 bps
* European stock markets lift from lows
* Traders eye ECB rate announcement for impact on currencies
(Recasts; adds comment)
By Jan Harvey
LONDON, Nov 6 (Reuters) - Gold jumped to session highs of
$748.10 an ounce on Wednesday after the Bank of England slashed
rates by a consensus-busting 150 basis points and the Swiss
National Bank cut its rates by half a point.
European shares lifted from lows after the news, which has
boosted hopes of a larger-than-expected cut from the European
Central Bank later in the session, which should stimulate
growth.
Spot gold <XAU=> was quoted at $746.00/748.50 at 1240 GMT,
up from $739.45 an ounce late in New York on Wednesday.
Traders are awaiting an announcement from the ECB at 1245
GMT. If rates fall the appeal of non-interest bearing
investments such as gold would also increase.
"Interest rate cuts would provoke inflationary fears in the
longer term, and a lower opportunity cost would promote gold
investments," said Commerzbank analyst Eugen Weinberg.
European stocks recovered after falling in early trade on
Thursday, tracking losses in Asia and as oil extended losses to
below $65 a barrel, with weak U.S. data intensifying fears over
the prospect of a global recession. []
Shares bounced on Wednesday after the victory of Democrat
Barack Obama in the U.S. presidential election, but gains were
short-lived after data showed cuts in private employment and a
sharp contraction in the services sector.
Traders are also awaiting U.S. non-farm payrolls data, due
on Friday, for clues to the next direction of trade.
The announcement is likely to have a significant effect on
the currency markets, which will impact gold. The precious metal
is often bought as a hedge against weakness in the U.S. dollar,
and typically moves in the opposite direction to it.
"Despite the rate cuts many participants may remain
sidelined until tomorrow's U.S. non-farm payroll data is
released," said Standard Bank analyst Walter de Wet.
The dollar was a touch firmer against the euro on Thursday
as traders anticipated rate cuts. []
SILVER DEMAND FIRM
Among other precious metals, silver <XAG=> was little
changed at $10.41/10.52 an ounce against $10.37.
While prices remain closely correlated to the dollar,
physical demand for silver remains firm, with holdings of the
world's largest silver-backed exchange traded fund, the iShares
Silver Trust, still only 2 percent down from all-time highs.
"Based on our conversations with merchants and on what we
believe to be increased physical flows, Indian silver bullion
imports for October will likely be higher than the 300 tonnes
achieved in September," said HSBC analyst James Steel in a note.
"Other parts of the emerging world are also active buyers,
and we note strong retail demand for silver coins, as
reported by North American coin dealers."
Platinum steadied after tumbling more than 4 percent in Asia
as investors took profits after Thursday's hefty rise.
The white metal climbed 5 percent last session after the
world's largest producer Anglo Platinum <AMSJ.J> said it was
temporarily shutting its Polokwane smelter in South Africa.
Spot platinum <XPT=> was quoted at $853.50/873.50 against
$862 an ounce late in New York on Wednesday, having earlier
touched a low of $824.50. Its sister metal palladium <XPD=> was
at $222/232 against $216.
(Reporting by Jan Harvey; editing by Karen Foster)
