PRECIOUS-Gold inches up, dealers expect buying on EU debt fears

                                
 * Trade thin ahead of year-end
                                
 * Coming Up: U.S. Initial Claims Weekly; 1330 GMT

 (Updates prices)	
                                
 By Lewa Pardomuan	
                                
 SINGAPORE, Dec 23 (Reuters) - Gold ticked up on Thursday 
and was likely to trade in a tight range as year-end 
approaches, but dealers still expected some buying related to 
credit rating warnings in Europe.	
                                
 The U.S. Labor Department's weekly jobless claims report 
and the Commerce Department's November new home sales data 
might offer some direction, although better-than-expected 
numbers could bode well for the dollar and weigh on bullion.	
                                
 Spot gold rose $2.36 an ounce to $1,386.91 an ounce 
by 0706 GMT. Gold was well below a historical high of around 
$1,430 hit earlier this month. 	
                                
 "I think gold is likely to be range bound, and it will be  
pretty difficult for gold to actually master sufficient 
momentum to move above the $1,400 level," said Ong Yi Ling, 
investment analyst at Phillip Futures in Singapore.	
                                
 "I would think to year-end, my resistance for gold will be 
$1,410. That would be the level I am looking at to cap the 
upside for gold," said Ong.	
                                
 U.S. gold futures for February were steady at 
$1,387.9 an ounce.	
                                
  The world's largest gold-backed exchange-traded fund, 
SPDR Gold Trust , said its holdings dropped to 1,288.616 
tonnes by Dec. 22 from 1,298.029 tonnes on Dec. 21. 
                                
 The euro won some reprieve on Thursday after plumbing a 
record low versus the Swiss franc overnight, but the 
currency's outlook was shaky at best and more losses into 2011 
are seen likely as the euro zone debt crisis looked set to 
drag on. 	
                                
 Five major Greek banks were put on notice on Wednesday 
that their credit ratings could be cut to junk, Fitch Ratings 
said, a day after it put the country's sovereign ratings on 
the same watch. [ID:nN22103645]	
                                
 Bullion was riding on fears the debt crisis in Europe 
would spread, with tensions in the Korean peninsula offering 
additional support. 	
                                
 North Korea on Thursday criticised major land and sea 
military exercises planned by the South, but stopped short of 
threatening a retaliatory strike as tension remained high on 
the peninsula. [ID:nTOE6BL05Z] 	
                                
  In a show of military might, South Korea held a major land 
 drill in the Pocheon region, between Seoul and the heavily  
armed demilitarised zone (DMZ) separating the two Koreas. It  
also continued naval live-fire exercises 100 km (60 miles)  
south of the maritime border with North Korea.  	
                                
 The physical market saw some bargain hunting but most 
jewellers were already away on holiday. Premiums for gold bars 
were steady at 70 cents to the spot London prices in Singapore.	
                                
 "We've done small business but other than that, it's very 
quiet. Most consumers are off," said a dealer in Singapore. 	
                                
 In other markets, resources-linked stocks rose and oil 
climbed towards the $91 per dollar mark after latest U.S. data 
offered yet another sign that the world's biggest economy is 
on the mend.   	
                                
 In main consumer India, gold demand was moderate on 
Wednesday as prices softened on a stronger rupee, but traders 
said the underlying appetite remained strong and many buyers 
kept to the sidelines waiting for bigger dips as the year-end 
drew closer.  
                                
 India's busy season for gold purchases is at its very end 
with the Hindu wedding days gradually abating after festivals 
ended last month. 	
                                
    	
  Precious metals prices at 0706 GMT                                   
  Metal             Last    Change  Pct chg  YTD pct chg  Turnover     
  Spot Gold        1386.91    2.36   +0.17     26.58                   
  Spot Silver        29.29    0.09   +0.31     74.03                   
  Spot Platinum    1725.24    3.74   +0.22     17.60                   
  Spot Palladium    750.72    2.47   +0.33     85.13                   
                                
                                                                    
  Euro/Dollar       1.3132                                             
  Dollar/Yen         83.06                                             
                                
                                                                    
  TOCOM prices in yen per gram. Spot prices in $ per ounce.            
 (Editing by Himani Sarkar)	
 
 
 
                                
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