* Gold rallies as investors risk appetite up; dollar falls
* Strong U.S. home sales data, Wall St rally boost bullion
* Platinum up 1 pct as Impala workers plan strike
(Recasts, updates with quotes, closing prices, adds NEW
YORK to dateline)
By Frank Tang and Veronica Brown
NEW YORK/LONDON, Aug 21 (Reuters) - Gold futures climbed
toward $960 an ounce on Friday, gaining more than 1 percent as
the dollar slumped against the euro, boosting the metal's
appeal as a hedge against the falling U.S. currency.
The inverse relationship between gold and the dollar has
been reasserting itself, analysts said.
A Wall Street rally amid optimistic U.S. existing home
sales data prompted investors to buy risker assets such as
commodities and equities and to shun safe-haven dollar holdings
such as U.S. Treasury bonds.
"Gold's rally is all due to the dollar weakness and the
possibility of inflation," said George Gero, vice president of
RBC Capital Markets Global Futures in New York. "It is trying
to break out and go onto the next resistance level, which is
$975."
U.S. December gold <GCZ9> settled up $13, or 1.4 percent,
at $954.70 an ounce on the COMEX division of the New York
Mercantile Exchange.
Spot gold <XAU=> rose as high as $957.65 an ounce, its
loftiest price since Aug. 14. It was last at $952.95 an ounce
at 2:15 p.m. EDT (1815 GMT), versus $939.35 quoted late in New
York on Thursday.
The dollar fell on Friday as its safe-haven appeal
decreased after upbeat comments from Federal Reserve Chairman
Ben Bernanke, and data showing sales of U.S. existing homes
notched their fastest rise in nearly two years in July.
Earlier in the session, the euro climbed against the dollar
after euro zone service sector and manufacturing showed gains
in activity.
Gold has recently risen in tandem with positive economic
news because it fuels investor risk appetite and boosts the
metal's inflation-hedge appeal.
Yet, the upside looked capped for bullion in the absence of
physical demand, and analysts said the struggle to break out of
recent ranges could well result in downside capitulation,
before another attempt to break above psychological resistance
at $1,000.
"There isn't really the driving force of physical demand
from either the jewelry sector or from the investment sector
... to help carry the price higher," said Tom Kendall, precious
metals strategist at Mitsubishi Corp.
PHYSICAL DEMAND LACKING
Asia-based traders said the absence of demand for gold
jewelry, as demonstrated by falling imports in India, was a
factor weighing on the spot market.
India's July gold imports fell two-thirds from a year
earlier as high prices dented demand in one of the world's top
markets where gold jewelry is often given as gifts during
festival seasons or at weddings, a trade body said this week.
In other metals, platinum <XPT=> firmed to $1,250.00 an
ounce from $1,236.50 an ounce after Impala Platinum <IMPJ.J>,
the world's second-biggest platinum producer, said on Friday it
would meet South Africa's miners' union on Saturday in a bid to
avert a strike planned for Monday.[]
Silver <XAG=> rose 2 percent to $14.15, following the gains
in gold and base metals, while palladium <XPD=> jumped nearly 3
percent to $279 an ounce versus its previous finish of $272.
Close Change Pct 2008 YTD
Chg Close Pct Chg
US gold <GCZ9> 954.70 13.00 1.4 884.30 8.0
US silver <SIU9> 14.164 0.284 2.0 11.295 25.4
US platinum <PLV9> 1259.20 17.20 1.4 941.50 33.7
US palladium <PAU9> 284.95 9.70 3.5 188.70 51.0
Prices at 2:15 p.m. EDT (1815 GMT)
Gold <XAU=> 953.05 13.70 1.5 878.200 8.5
Silver <XAG=> 14.15 0.26 1.9 11.30 25.2
Platinum <XPT=> 1250.00 13.50 1.1 924.50 35.2
Palladium <XPD=> 279.00 7.00 2.6 184.50 51.2
Gold Fix <XAUFIX=> 952.50 12.00 1.3 836.50 13.9
Silver Fix <XAGFIX=> 14.010 -0.030 -0.2 14.760 -5.1
Platinum Fix <XPTFIX=> 1239.00 0.00 0.0 1529.00 -19.0
Palladium Fix <XPDFIX=> 275.00 0.00 0.0 365.00 -24.7
(Additional reporting by Humeyra Pamuk in London and Miho
Yoshikawa in Tokyo; Editing by Lisa Shumaker)
