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* Investors opt for bullion over paper currencies
* Market shrugs off IMF plans to sell gold to open market
* Stronger dollar failed to drag down gold
(Recasts, updates prices, market activity; adds new byline, second
dateline, previously LONDON)
By Alonso Soto and Jan Harvey
NEW YORK/LONDON, Feb 18 (Reuters) - Gold rose on Thursday as investors
bought bullion despite a firmer dollar and news of upcoming gold sales by the
International Monetary Fund.
Spot gold <XAU=> was bid at $1,122.90 an ounce at 3:37 p.m. EST (2037 GMT),
up from $1,106.00 late in New York on Wednesday. In early trading, gold rose to
a session high of $1,123.30 an ounce after sliding as low as $1,097.80 as the
market reacted to news of the planned IMF sale.
U.S. gold futures for April delivery <GCJ0> on the COMEX ended slightly
down, shedding $1.40 to end at $1,118.70 an ounce. But it reversed losses after
hours to bid at $1,124.00 at 3:43 p.m. (2043 GMT).
"People are looking for an alternative to the euro and not turning to the
U.S. dollar, but to gold as a safe haven," said Michael Pento, senior markets
analyst with Delta Global Advisors.
Debt default worries in Europe have pushed investors toward gold. The price
of gold in euro terms <XAUEUR=R> hit a record high of 824.27 euros an ounce.
Investors use gold as a hedge against financial turbulence and inflation.
Gold generally has in inverse relationship with the dollar, which rallied
against the euro in a volatile session. Mixed data fed doubts about the U.S.
economy but failed to offset concern about the euro zone. []
WON'T DUMP IT
The IMF said it would sell 191.3 tonnes of gold to the open market under a
program approved last year to boost resources for lending. The move has called
into question demand for bullion from official sector buyers. []
The fund said the sales, part of a program launched last year, will be
phased over time to avoid market disruptions.
It also left the door open for central banks to keep buying gold directly,
nearly four months after India's purchase of 200 tonnes boosted the country's
gold holdings to the 10th largest among central banks.
Analysts see little interest among central banks to buy more gold.
Sri Lanka's central bank governor said his bank was unlikely to buy more
gold from the IMF right now as the island nation has already reached its
required reserve level. []
Among other precious metals, silver <XAG=> was bid at $16.17 an ounce
against $15.84, platinum <XPT=> at $1,529.00 an ounce against $1,524.50 and
palladium <XPD=> at $436.50 from $433.50.
Close Change Pct 2009 YTD
Chg Close % Chg
US gold <GCJ0> 1118.70 -1.4 -0.1 1096.20 2.1
US silver <SIH0> 16.060 -0.038 -0.2 16.845 -4.7
US platinum <PLJ0> 1519.60 -17.50 -1.1 1471.00 3.3
US palladium <PAH0> 435.25 -2.75 -0.6 408.85 6.5
Prices at 3:58 p.m. EST (2058 GMT)
Gold <XAU=> 1086.55 16.05 1.5 1096.35 -0.9
Silver <XAG=> 16.16 0.32 2.0 16.84 -4.0
Platinum <XPT=> 1527.50 3.00 0.2 1465.50 4.2
Palladium <XPD=> 436.50 3.000 0.7 405.50 7.6
Gold Fix <XAUFIX=> 1118.00 12.50 1.1 1104 1.3
Silver Fix <XAGFIX=> 15.83 -38.00 -2.3 16.99 -6.8
Platinum Fix <XPTFIX=> 1524.00 12.00 0.8 1466 4.0
Palladium Fix<XPDFIX=> 434.00 5.00 1.2 402 8.0
For a Factbox on central banks' views on gold click on []
For a story on Impala Platinum's output click on []
For story on Barrick Gold spinning off African assets click on
[]
(Reporting by Alonso Soto; Editing by David Gregorio)
