UPDATE 3-Gold rebounds on covering,platinum at near-3 year low

                                
 * Gold near 2-week low on surging dollar
                                
 * Platinum strikes lowest in nearly 3 years on demand
fears
 (Updates prices, adds quotes)
                                
 By Lewa Pardomuan
                                
 SINGAPORE, Oct 3 (Reuters) - Gold bounced on Friday but
held within sight of a two-week low as the U.S. dollar hovered
near a one-year peak against other currencies, while platinum
was at its weakest in almost three years on demand fears.
                                
 Platinum, mainly used in autocatalysts to clean exhaust
pipes, has lost more than 50 percent in value since spiking to
a lifetime high at $2,290 an ounce in March, on profit taking
and recently on poor car sales and a slowing U.S. economy.
                                
 Platinum was also hit by recent weakness in gold prices
after the dollar gained on hopes the U.S. Congress would pass a
$700 billion bailout plan. In theory, a rising dollar reduces
gold's appeal as an alternative investment to currencies,
stocks and bonds.
                                
 Gold <XAU=> was trading at $838.80 an ounce, up $3.80 from
New York's notional close due to short covering and
anticipation of a poor U.S. employment report, having hit an
intraday low of $829.20 an ounce on Thursday.
                                
 "I am not surprised we've seen some bounce in trading today
from the lower levels that we went to last night," said David
Moore, analyst at Commonwealth Bank of Australia.
                                
 "I think it's probably more related to the issues
associated with uncertainty about the international economic
outlook and strain in the financial system," he said.
                                
 Gold's rebound also plucked silver <XAG=> from a two-week
low below $11 an ounce. Gold was still well below a record of
$1,030.80 struck in March.
                                
 The dollar index, which gauges performance against a basket
of six major currencies, barely moved at 80.437 on Friday
<.DXY> after reaching a one-year peak of 80.794 the previous
day. [USD/]
                                
 Investors also await the release of an employment report by
the Labor Department on Friday after U.S. weekly initial
jobless claims came in higher than expected, underscoring the
deterioration in the labour market.
                                
 "We will have to see how the dollar reacts to the (bailout)
bill and the jobs data. I am still slightly positive on the
dollar," said Adrian Koh, an analyst at Phillip Futures in
Singapore.
                                
  "With the European Central Bank signaling a possible rate
cut, seems like the euro is going to be a bit pressured. I am
looking at $820 for near-term support, then $800. Upside
resistance will come in around $845," said Koh, referring to
levels seen in August.
                                
 U.S. House Democratic leaders expressed optimism on
Thursday a revised $700 billion financial industry rescue bill
passed by the Senate will clear the House of Representatives.
[ID:nN02265016]
                                
 Platinum <XPT=> was trading at $960.00 an ounce, unchanged
from New York's notional close, having hit an intraday low of
$946.50 an ounce, its lowest level since December 2005, as poor
car sales weighed on sentiment.
                                
 "Platinum below $1,000 is incredible. Jewellery demand has
decreased so much, and so much scrap has been sold back to
fabricators," said Yukuji Sonoda, precious metals analyst at
Daiichi Commodities in Tokyo.
                                
 "It's very possible for platinum to fall to $900," said
Sonoda, referring to a level last seen in August 2005.
                                
 More than 60 percent of global use in platinum goes to
autocatalysts. Platinum is also used in jewellery.
                                
 Major automakers reported plunging U.S. sales for
September, led by a 34 percent slide at Ford Motor Co, as the
escalating credit crisis hit the industry and raised new doubts
about when the world's auto market would stabilise.
[ID:nN01506733]
                                
 New York gold futures <GCZ8> fell $2.1 to $842.2 an ounce.
  Precious metals prices at 0710 GMT
 Metal             Last    Change  Pct chg  YTD pct chg
Turnover
 Spot Gold         838.80    3.80   +0.46      0.73
 Spot Silver        11.17    0.38   +3.52    -24.37
 Spot Platinum     960.00    0.00   +0.00    -36.84
 Spot Palladium    199.00    7.50   +3.92    -45.92
 TOCOM Gold       2839.00  -91.00   -3.11     -7.22       
50422
 TOCOM Platinum   3220.00  -97.00   -2.92    -39.69       
19115
 TOCOM Silver      382.60  -31.30   -7.56    -29.28         
854
 TOCOM Palladium   695.00   -7.00   -1.00    -48.56         
580
 Euro/Dollar       1.3815
 Dollar/Yen        105.36
 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)