* Gold at highest since March 7, silver at 31-year peak
* New U.S. single-family home sales hit record low
* Coming up: U.S. initial jobless claims Thursday
(Rewrites, updates market activity, adds comments, detail, NEW
YORK byline, dateline)
By Frank Tang and Pratima Desai
NEW YORK/LONDON, March 23 (Reuters) - Gold rose to within a
whisker of its all-time high on Wednesday, as disappointing U.S.
housing data, renewed euro zone debt fears and ongoing Western air
strikes on Libya increased the metal's safe-haven appeal.
Bullion rose to less than $5 below its record $1,444.40 an
ounce set on March 7, after a report showed the U.S. housing
market slide was deepening, as new U.S. single-family home sales
unexpectedly fell in February to hit a record low and prices were
the lowest since December 2003. []
"The new home sales data inspired some to think that we may
not see the demise of QE2, and we are going to see money printing
continue past its potential expiration at the end of June," said
Mark Luschini, chief investment strategist of broker-dealer Janney
Montgomery Scott with $53 billion assets under management.
"That would likely mean more stimuli and more prospect for
inflation, and that's gold friendly," he said.
Spot gold <XAU=> rose 0.6 percent $1,438.55 an ounce by 12:03
p.m. EDT (1603 GMT). The precious metal hit a session high of
$1,440.90, its highest since March 7.
While commodity markets were mostly quiet on Wednesday, gold
was one of the most actively trading markets with volume
approaching 125,000 contracts at midday.
Spot silver <XAG=> soared above $37 an ounce, its highest
since 1980. It later gained 1.5 percent to $36.88 an ounce.
Year to date, silver has gained nearly 20 percent, and gold
was up just over 1 percent. Silver was boosted by near-term supply
tightness and strong industrial demand on expectations the global
economy continued to recover.
(Graphic: http://link.reuters.com/pat68r)
Gold has benefited tremendously as a hedge against currency
depreciation since last November, when the Federal Reserve
announced its plan to increasing money supply by buying $600
billion of long-dated U.S. Treasury bonds to boost growth, a
process known as quantitative easing.
The latest flurry of gold purchases was also bolstered by the
expectation Portugal's parliament would reject the government's
latest austerity measures, and that rekindled euro zone debt
worries ahead of a summit of the economic bloc. []
Both platinum and palladium, mainly used as autocatalysts in
vehicles, have come under pressure since Japan's March 11
earthquake and tsunami shut car factories in Japan.
Platinum <XPT=> climbed 0.6 percent to $1,743 an ounce and
palladium <XPD=> gained 1.2 percent to $741.97 from $733.
Toyota Motor Co <7203.T> has halted operations at its 12 main
assembly plants in Japan until at least Saturday, which will
result in lost production of 140,000 vehicles. Other major car
makers also have yet to resume full production due to a shortage
of parts and workers. []
Prices at 12:03 p.m. EDT (1603 GMT)
LAST NET PCT YTD
CHG CHG CHG
US gold <GCJ1> 1439.10 11.50 0.8% 1.2%
US silver <SIK1> 36.900 0.631 1.7% 19.3%
US platinum <PLJ1> 1748.10 8.70 0.6% -1.6%
US palladium <PAM1> 745.10 7.25 1.0% -7.2%
Gold <XAU=> 1438.55 9.30 0.6% 1.3%
Silver <XAG=> 36.88 0.54 1.5% 19.5%
Platinum <XPT=> 1743.00 11.00 0.6% -1.4%
Palladium <XPD=> 741.97 8.97 1.2% -7.2%
Gold Fix <XAUFIX=> 1439.50 6.50 0.5% 2.1%
Silver Fix <XAGFIX=> 36.58 63.00 1.8% 19.4%
Platinum Fix <XPTFIX=> 1744.00 3.00 0.2% 0.8%
Palladium Fix <XPDFIX=> 739.00 3.00 0.4% -6.6%
(Additional reporting by Rebekah Curtis in London; Editing by
Lisa Shumaker)
