* Gold consolidates after record high; new peaks eyed
* South African gold output falls but scrap supply picks up
* Palladium, platinum, rhodium hit highest in over a year
(Updates prices)
By Jan Harvey
LONDON, Nov 12 (Reuters) - Gold edged off the record high it
hit early on Thursday as the dollar recovered from lows, but the
metal is poised for further gains as investors buy the metal as
an alternative to the weakening U.S. currency.
Spot gold rallied to a record $1,122.85 an ounce in Asian
trade. Its strength helped lift other precious metals, with
palladium, platinum and rhodium all reaching their highest in
more than a year as speculative money poured into the market.
At 1213 GMT, spot gold <XAU=> was bid at $1,115.50 an ounce,
versus $1,117.45 late in New York on Wednesday. U.S. gold
futures for December delivery <GCZ9> on the COMEX division of
the New York Mercantile Exchange firmed $1.50 to $1,116.10.
"Gold is on a really strong footing, making highs early on,"
said Calyon metals analyst Robin Bhar. "As the dollar index
strengthens, it is taking some of the attraction away from gold,
but you have to say it has done well."
The dollar edged higher against the euro <EUR=> and a basket
of six currencies <.DXY> in Europe on Thursday, recovering
earlier losses made ahead of a meeting of Asian finance
ministers this weekend. []
But overall the dollar remained vulnerable to further losses
as a global economic recovery boosts the appeal of assets seen
as higher risk, such as equities and higher-yielding currencies.
"Consensus remains very dollar bearish, not least because of
new downbeat comments from the Fed with the market expecting no
change in the benchmark dollar rate for a prolonged period of
time," VTB Capital analyst Andrey Kryuchenkov said in a note.
"A sustained push below 75 on the index could see gold
rallying even higher towards $1,150 before the end of the
month," he added.
S.AFRICA OUTPUT DROPS
South Africa, formerly the world's biggest gold producer and
now number three, said its gold output dropped 9.3 percent in
volume terms in September. []
Sales of scrap gold are increasing in India, the world's
biggest bullion consumer last year, dealers said, as higher
prices encourage consumers to sell gold back to the market.
"There are 15-20 people lined outside my shop for scrap
sales, and we expect around 50-60 of them to come in by
evening," said Jitendra Kantilal, partner at Zaveri Bazaar-based
Jugraj Kantilal & Co. []
But demand for new products remained weak as traders were
reluctant to place fresh orders in the middle of the wedding
season, which will last until December.
The chief executive of Barrick Gold Corp <ABX.TO>, the
world's biggest gold miner, told the Financial Times gold may
ease from current highs, although the chances of prices falling
below $900 an ounce are slim. []
Spot silver <XAG=> was bid at $17.48 an ounce against
$17.57, tracking gold.
Palladium, platinum and rhodium all hit their highest level
in more than a year on a wave of speculative buying of the
precious metals used in autocatalysts.
Palladium reached its highest since August 2008 at $356 an
ounce, while platinum struck a 14-month high of $1,379 in early
trade. Later platinum <XPT=> was flat at $1,368, while palladium
<XPD=> was up 3.5 percent at $353.50 against $341.50.
Rhodium <RHOD-LON> also reached $2,075 an ounce, its highest
since October 2008.
One European platinum group metals trader said the metals
were benefiting from purely speculative flows, prompted by talk
of a recovery in Chinese and wider buying. "There is no real
industrial demand behind it," he said.
(Editing by Sue Thomas)
