* Speculators sell gold to cover losses
* Coming Up: U.S. FOMC rate decision Jan; 1815 GMT
(Updates prices)
By Lewa Pardomuan
SINGAPORE, March 15 (Reuters) - Gold slid more than 1
percent on Tuesday as declines in stock markets triggered by a
deepening nuclear crisis in Japan prompted speculators to sell
bullion to cover losses, while holdings on the ETF fell to their
lowest since May last year.
Silver fell around 3 percent. Platinum and
palladium gave up early gains and dropped more than 1
percent after Japanese shares slumped for a second day on
Tuesday as a fresh explosion rocked a stricken nuclear plant.
Gold lost $15.66 an ounce to $1,410.99 by 0421 GMT,
after rising as much as 1 percent on Monday as Japan battled to
prevent a nuclear catastrophe after last week's devastating
quake and tsunami and on political unrest across the Arab world.
"It still looks like it's constructive. It's just
consolidating. But if we get a large sell-off in equities,
people will tend to sell gold," said Jonathan Barratt, managing
director of Commodity Broking Services in Melbourne.
"But if it's a major concern, then people will eventually go
to gold as the last resort."
Premiums for gold bars were steady at between $1.00 and
$1.50 an ounce to spot London prices in Hong Kong and Singapore,
with no signs of safe-haven buying related to last week's
massive earthquake and tsunami in Japan and the subsequent
nuclear crisis.
Japan faces a recovery and reconstruction bill of at least
$180 billion -- 3 percent of its annual economic output -- or
more than 50 percent higher than the total cost of 1995's
earthquake in Kobe.
Japan warned that radioactive levels had become
significantly higher around a quake-stricken nuclear power plant
on Tuesday after explosions at two reactors, and the French
embassy said a low level radioactive wind could reach Tokyo by
the evening.
"The price shot up to above $1,430 but it could not break
through that level. I think that's why the market is down. Also,
ETF holdings seem to be going down again," said a dealer in
Singapore.
"We can say people are selling gold to cover their margin
call."
U.S. gold futures for April fell $12.50 to $1,412.4
an ounce.
In the Middle East, the United States urged Saudi Arabia on
Monday to show restraint after it sent troops to neighbouring
Bahrain in a move some analysts said showed the limits of
Washington's influence in the region.
The deployment of 1,000 Saudi troops, at the request of
Bahrain's Sunni royal family, came two days after U.S. Defense
Secretary Robert Gates visited the island kingdom and pressed
its rulers to implement political reforms to defuse tensions
with the Shi'ite Muslim majority.
Rising tensions in North Africa and the Middle East helped
bullion strike record around $1,444 last week.
The yen surged on Tuesday after Japan's prime minister said
radiation levels near a quake-hit nuclear plant had become high
and the risk of further nuclear leakage was rising, prompting
investors to dump risky assets.
The Bank of Japan (BOJ) said on Monday it would increase
the size of its asset purchase to 10 trillion yen ($122 billion)
from 5 trillion yen and analysts think it may take more steps if
the economic outlook deteriorates further.
The BOJ is even more dovish than the U.S. Federal Reserve,
which has been cautious about seeking to exit its stimulus
policy as it wants to bring down unemployment.
U.S. Federal Reserve policymakers meet on Tuesday and
investors will closely watch the Fed's assessment on
unemployment and the economy in general.
Precious metals prices 0421 GMT
Metal Last Change Pct chg YTD pct chg Turnover
Spot Gold 1410.99 -15.66 -1.10 -0.60
Spot Silver 34.80 -1.05 -2.93 12.77
Spot Platinum 1717.00 -32.99 -1.89 -2.86
Spot Palladium 725.72 -14.28 -1.93 -9.23
TOCOM Gold 3711.00 -60.00 -1.59 -0.48 50868
TOCOM Platinum 4518.00 -120.00 -2.59 -3.79 26292
TOCOM Silver 90.20 -2.00 -2.17 11.36 1820
TOCOM Palladium 1884.00 -100.00 -5.04 -10.16 875
Euro/Dollar 1.3909
Dollar/Yen 81.59
TOCOM prices in yen per gram. Spot prices in $ per ounce.
(Editing by Ramthan Hussain)
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