* Gold edges up, but off Friday's 3-week high.
* Capped by stock market rally and scrap gold selling.
* SPDR Gold holdings hit another record
By Risa Maeda
TOKYO, March 23 (Reuters) - Gold edged up on Monday as its
appeal as a haven against inflation continued to lure
investors, but was capped by scrap gold selling and a stock
market rally after a U.S. plan to address toxic assets at
banks.
The U.S. Treasury on Monday released details of a planned
public-private effort to rid U.S. banks of toxic assets,
pushing Asian stocks <.MIASJ0000PUS> to a two-month high and
Tokyo's Nikkei share average <> to its highest close in
seven weeks. []
But a consistent rise in holdings of gold-backed securities
underlined fund managers' appetite for gold that continued into
Monday, while a fall in the dollar against the euro also
supported prices.
The world's largest gold-backed exchange-traded fund, SPDR
Gold Trust <GLD>, said its holdings hit a record 1,114.60
tonnes as of March 20, up 11.31 tonnes or 1 percent from the
previous day. []
Buying of gold by ETFs, which back the securities they
issue with physical stocks of bullion, has picked up pace since
the U.S. Federal Reserve announced plans to buy $300 billion in
longer-dated Treasuries on Wednesday, spurring inflation
concerns.
SPDR alone has added 45.55 tonnes of gold to its reserves
since Wednesday.
The dollar's decline continued on Monday, with the euro
rising 1 percent against the greenback after the toxic asset
plan. []
Spot gold <XAU=> was trading at $955.50 an ounce at 0559
GMT, up 0.5 percent from New York's notional close of $950.90
on Friday, when it rose as high as $966.70, its highest level
since Feb. 25.
"Since the Fed's move to buy long-term government debt,
gold has soared by more than $60, and that warrants demand (on
any dips)," said a manager at a Japanese trading firm.
"Buying from hedge funds and others is in the market, that
is being reflected in a steady increase in the holdings by
gold-backed ETFs," he said.
Last week gold rose 2.6 percent, the biggest weekly gain
since the week to Feb. 20, during which it briefly topped
$1,000.
U.S. gold futures for April delivery <GCJ9> fell $1.0 per
ounce to $955.20, adding to a $2.60 fall in the previous
session.
Net noncommercial long positions rose 3.9 percent to
150,395 lots in the week to March 17, a report by the U.S.
Commodity Futures Trading Commission showed, a sign of possible
profit-taking to follow after a volatile market last week.
Among other precious metals, spot platinum <XPT=> fell to
$1,107.50 an ounce in a retreat from a near six-month high of
$1,127.50 on Friday.
But platinum, chiefly an industrial commodity, pared
earlier losses on speculative buying in the wake of Monday's
rally in non-ferrous metal prices on growing optimism about
global demand, traders said.
Precious metals prices at 0621 GMT
Metal Last Change Pct chg YTD pct chg
Turnover
Spot Gold 955.00 4.10 +0.43 50.23
Spot Silver 13.87 0.15 +1.09 7.94
Spot Platinum 1109.00 -3.50 -0.31 -2.03
Spot Palladium 205.00 0.50 +0.24 -38.25
TOCOM Gold 2968.00 79.00 +2.73 21.39
37125
TOCOM Platinum 3447.00 162.00 +4.93 -18.97
12447
TOCOM Silver 423.90 33.50 +8.58 -14.07
818
TOCOM Palladium 642.00 29.00 +4.73 -48.84
496
Euro/Dollar 1.3664
Dollar/Yen 96.23
TOCOM prices in yen per gram, except TOCOM silver which is
priced in yen per 10 grams. Spot price in $ per ounce.
(Additional reporting by Miho Yoshikawa; Editing by Michael
Urquhart)
