(Updates prices, adds physical sector)
By Lewa Pardomuan
SINGAPORE, March 5 (Reuters) - Gold crept up on Wednesday
as bargain hunters resurfaced after a drop the previous day,
while supply fears helped platinum stay near an all-time high.
Gold <XAU=> edged up to $964.50/965.30 an ounce from
$963.20/964.00 late in New York on Tuesday, when it dropped
nearly 2 percent after a reversal in oil prices sparked heavy
selling from speculators.
Though gold remained below Monday's record of $989.30,
analysts said the metal was still on track to hit $1,000 with
oil hovering near an all-time high and the dollar's appeal
declining on expectations of more interest rate cuts in the
United States.
"The outlook for gold is obviously subject to uncertainty,"
said David Moore, an analyst at Commonwealth Bank of Australia
in Sydney, referring to Tuesday's sharp drop to as low as
$960.40.
"In my opinion, though, it is quite likely we'll see $1,000
an ounce at a certain point in coming months. Probably, this
morning, you just saw people taking advantage of the dip in
prices last night."
Oil <CLc1> briefly regained $100 a barrel on Wednesday
after falling almost $3 a barrel the previous day, aided by
expectations that OPEC would decide to hold output steady later
in the day. []
Firm oil prices lift gold's appeal as a hedge against
inflation.
Gold was previously fixed at a record high of $850 in
January 1980 as high inflation linked to strong oil prices,
Soviet intervention in Afghanistan and the impact of the
Iranian revolution sparked heavy buying from investors.
After adjusting for inflation, the 1980 high was $2,119.30
an ounce at 2007 prices, while the real average price in 1980
has been calculated at $1,532.14, according to precious metals
consultancy GFMS Ltd.
In the physical sector, gold's fall from record highs
spurred buying by jewellers in Asia, while the marriage season
in India, the world's largest bullion consumer, helped the
local market. []
"Gold will try the lower end first and then see whether it
can hold. If not, it will try the major support of $950," said
Ronald Leung, director of Lee Cheong Gold Dealers in Hong Kong.
"The upside seems to be capped at $970. We are expecting
some correction," said Leung.
Spot platinum <XPT=> rose to $2,227/2,235 an ounce from
$2,220/2,230 an ounce, holding near Tuesday's record high of
$2,290 on persistent supply fears after a power crisis
disrupted mining in main producer South Africa.
The most active platinum futures in Tokyo Commodity
Exchange <0#JPL:> fell 15 yen per gram to 7,259 yen as
speculators booked profits after pushing up the price by the
daily 300 yen limit to 7,274 yen the previous day.
Spot palladium <XPD=> rose to $547/552 an ounce from
$545/550 an ounce, having reached a 6-1/2-year high of $590 on
Tuesday.
Silver <XAG=> edged down to $19.52/19.57 an ounce from
$19.71/19.76 an ounce -- off Monday's 27-year high at $20.60 an
ounce.
Gold futures for April delivery <GCJ8> on the COMEX
division of the New York Mercantile Exchange fell $0.5 an ounce
to $965.8 an ounce, off the record high of $992.00 hit Monday.
Precious metals prices at 0715 GMT
Metal Last Change Pct chg YTD pct chg
Turnover
Spot Gold 964.00 0.40 +0.04 15.77
Spot Silver 19.50 -0.24 -1.22 32.02
Spot Platinum 2227.00 7.00 +0.32 46.51
Spot Palladium 547.00 2.00 +0.37 48.64
TOCOM Gold 3237.00 -51.00 -1.55 5.78
58315
TOCOM Platinum 7261.00 -13.00 -0.18 36.00
23804
TOCOM Silver 657.50 -21.50 -3.17 21.53
1718
TOCOM Palladium 1951.00 -100.00 -4.88 44.41
17740
Euro/Dollar 1.5186
Dollar/Yen 103.62
TOCOM prices in yen per gram, except TOCOM silver which is
priced in yen per 10 grams. Spot prices in $ per ounce.
(Editing by Ben Tan)
