(Adds quote, physical demand, updates prices)
By Maryelle Demongeot
SINGAPORE, May 29 (Reuters) - Gold slipped again below $900
an ounce on Thursday, under pressure from a stronger U.S.
dollar that helped push oil lower and weakened bullion's appeal
both as an anti-inflation tool and an alternative currency.
Spot gold <XAU=> was quoted at $897.20/898.20 an ounce by
0620 GMT, down from $899.65/901.05 an ounce late in New York on
Wednesday.
"A firmer dollar and weaker oil are two negatives for gold.
So gold could easily underperform oil," said Mark Pervan,
senior commodities analyst with ANZ.
"If oil falls 3-4 percent this week, gold could fall 4-5
percent," Pervan added, predicting that gold prices could fall
to $880 an ounce by the end of this week, and $850 next week
before bottoming out.
Gold has already fallen more than $35 an ounce from last
week's $935.30-high, which was its highest in a month, and came
after oil hit an all-time peak of $135.09 a barrel.
The dollar rose on Thursday, clawing back toward a two-week
high hit in the previous session after better-than-expected
U.S. durable goods orders eased concerns about the U.S.
economic outlook. []
The dollar index <.DXY>, which measures the dollar's value
against a basket of major currencies, rose 0.34 percent to
72.781, after having gained around 0.3 percent on Wednesday.
The stronger dollar also added a bearish tone to oil
prices, which have failed to reach new records for a week as
several developing nations in Asia have cut subsidies, possibly
prompting a drop in Asian energy demand.
Front-month U.S. crude for July delivery <CLc1> was down 72
cents at $130.21 a barrel on the Globex electronic trading
platform by 0340 GMT.
Gold tends to move in line with oil prices as dearer crude
boosts bullion's appeal as a hedge against inflation.
"I am expecting a lower gold market on oil prices. But on
the other hand, demand for physical gold will be higher because
of lower spot gold," said Ellison Chu, senior manager at
Standard Bank London in Hong Kong.
"Physical demand was a bit slow last week. But it is better
now with gold prices lower", Chu said, adding that demand from
most Asian buyers, such as Indonesia, was on the rise.
Gold futures for June delivery <GCM8> on the COMEX division
of the New York Mercantile Exchange were down $4.40 an ounce at
$896.10 an ounce.
The most active Tokyo gold futures contract <0#JAU:> for
April was up 26 yen at 3,054 yen per gram.
Spot platinum <XPT=> fell to $2,037/2,057 an ounce from
$2,059/2,079 late in New York.
The most active Tokyo platinum futures <0#JPL:> for April
fell 19 yen per gram to 6,721 yen by late morning, after
having settled down 300 yen, its daily limit, at 6,740 yen on
Wednesday.
Spot silver <XAG=> was steady at $17.36/17.43 an ounce from
$17.37/17.43 an ounce.
Spot palladium <XPD=> was slightly down at $431/436 an
ounce, from $432/$440.
Precious metals prices at 0620 GMT
Metal Last Change Pct chg YTD pct chg
Turnover
Spot Gold 897.20 -2.90 -0.32 7.75
Spot Silver 17.36 0.00 +0.00 17.54
Spot Platinum 2037.00 -22.00 -1.07 34.01
Spot Palladium 430.50 -2.00 -0.46 16.98
TOCOM Gold 3054.00 26.00 +0.86 -0.20
22680
TOCOM Platinum 6721.00 -19.00 -0.28 25.88
20798
TOCOM Silver 592.50 9.90 +1.70 9.52
634
TOCOM Palladium 1484.00 29.00 +1.99 9.84
1021
Euro/Dollar 1.5593
Dollar/Yen 105.00
Note - TOCOM prices in yen per gram, except TOCOM silver which
is priced in yen per 10 grams. Spot prices in $ per ounce.
(Editing by Michael Urquhart)
