(Recasts, updates prices, pvs TOKYO)
By Lewa Pardomuan
LONDON, May 16 (Reuters) - Gold rose on Friday, buoyed by
firm oil prices, but investors were careful about taking large
positions ahead of a raft of U.S. data, which may set the
direction for the dollar and precious metals.
Platinum was also firmer amid speculation precious metals
refiner Johnson Matthey <JMAT.L> may release another bullish
outlook in its annual report on platinum group metals next week.
Spot gold <XAU=> rose to $884.95/885.95 an ounce from
$881.55/882.75 an ounce late in New York on Thursday, when it
hit a high of $887.50 on a combination of a falling dollar and
rising oil prices.
"I think we're likely to see more rangebound trading,
between the established $850 and $900 in the absence of a new
catalyst," said Suki Cooper, precious metals analyst at Barclays
Capital.
"I think the underlying fundamentals for platinum are very
strong. We're likely to see another large deficit in the market
this year, given the expectations for reduced supply on the back
of the power problems in South Africa."
Spot platinum <XPT=> firmed to $2,098/2,113 an ounce from
from $2,079/2,094 late in New York.
Platinum, used in jewellery and auto catalysts, powered to
record high of $,2,290 an ounce on March 4 after a power crisis
in main producer South Africa disrupted mining and sparked fear
of a supply deficit.
In other markets, oil <CLc1> bounced to $125 a barrel on
Friday, within sight of this week's all-time peak of $126.98,
led by the bullish heating oil market as China and Europe
scramble for barrels, thinning global supply.
In theory, rising energy costs boost gold's appeal as a
hedge against inflation.
The euro edged up to $1.5471 <EUR=> as investors awaited
April housing starts and building permits numbers at 1230 GMT
and the May Reuters/University of Michigan consumer sentiment
index at 1355 GMT for clues on the depth of the U.S. economic
slowdown.
The most active June gold futures contract <GCM8> on the
COMEX division of the New York Mercantile Exchange added $5.7 to
$885.7 an ounce.
"The fund may be a little bit on the buying side, but
jewellers are waiting for the downside," said Ronald Leung,
director of Lee Cheong Gold Dealers in Hong Kong.
"I think we have to wait for more data to confirm whether
the U.S. is in a recession," said Leung, who also expects gold
to trade within the familiar range of $850 to $900.
Gold hedging positions of mining companies fell 18 percent
to 22 million ounces in the first quarter of 2008, a report
sponsored by Fortis Bank said on Friday, forecasting a full-year
drop of 10-12 million ounces. []
Palladium <XPD=> rose at $437.00/442.00 an ounce from
$432/440 in late New York. Silver <XAG=> edged up to
$16.74/16.80 an ounce from $16.70/16.76 in New York.
(Editing by Ben Tan)
