* Gold, silver, platinum hit one-week highs
* Gold may rise to $1,417 - technicals []
* Coming up: U.S. FOMC rate decision; 1915 GMT
(Updates prices)
By Rujun Shen
SINGAPORE, Dec 14(Reuters) - Spot gold breached above the
key $1,400 level for the first time in a week, riding on
dollar weakness and buoyed by buying interest from China, but
trading volumes remained thin ahead of the year end.
Investors are watching the Federal Reserve meeting later
today, as well as for signals on monetary policy moves in
China, to gauge the health of the world's top two economies.
Spot gold rose to a one-week high of $1,405.85 an
ounce, before easing to $1,403.66 by 0707 GMT, up 0.8 percent
from the previous close.
U.S. gold futures gained half a percent to $1,404.7
an ounce.
"Gold is following up momentum with the selling in dollar
towards the year end," said a Singapore-based trader. "We are
resuming the uptrend, and there are not many down days to be
expected."
The dollar remained weak after slumping on Monday as U.S.
deficit concerns resurfaced, while the euro hovered near
three-week highs against the dollar.
Traders cited buying from Chinese banks behind the
strength in the bullion, but said the volume was very light as
most funds and traders choose to avoid risks towards the year
end.
"Many fund managers are already enjoying the sunshine.
Between now and the end of the year fund activities will
diminish," said Ronald Leung, a physical dealer at Lee Cheong
Gold Dealers in Hong Kong.
Physical buying emerges at levels below $1,400, helping
support prices, traders also said.
Spot gold is expected to rise to $1,417 per ounce,
as a double-bottom has been confirmed, said Reuters market
analyst Wang Tao.
For a 24-hour gold technical outlook:
http://graphics.thomsonreuters.com/WT/20101412092528.jpg
Spot silver gained for a second straight session to
a one-week high of $29.88.
Platinum also rose to a one-week high of $1,707.25,
before easing to $1,703.99.
POLICY WATCH
Investors continue watching potential policy moves from
major economies in the world.
The Federal Reserve policy board meets later Tuesday and
is expected to reaffirm its quantitative easing policy even
while acknowledging the better run of data recently, just
before a European Union summit later this week. []
[]
In China, the central bank raised reserve ratio
requirements for banks for the third time in a month last week
but refrained from raising interest rates, a move seen to
benefit commodities.
"Only if they really raised interest rates it would put
real pressure on the market," said Leung of Lee Cheong.
A Reuters poll showed that China is poised to raise
interest rates before the end of this year, but will then
increase them just twice more in 2011, relying instead on
using lending controls. []
But an official newspaper said on Tuesday that China will
probably target about 7.5 trillion yuan ($1.1 trillion) in new
loans next year, level with its 2010 target, an indication
that policy could be slightly looser than expected.
[]
Precious metals prices at 0707 GMT
Metal Last Change Pct chg YTD pct chg Turnover
Spot Gold 1403.66 10.51 +0.75 28.11
Spot Silver 29.81 0.33 +1.12 77.12
Spot Platinum 1703.99 8.25 +0.49 16.15
Spot Palladium 755.55 1.08 +0.14 86.33
TOCOM Gold 3775.00 13.00 +0.35 15.83 45338
TOCOM Platinum 4631.00 19.00 +0.41 5.71 11121
TOCOM Silver 80.60 2.10 +2.68 55.90 1923
TOCOM Palladium 2046.00 26.00 +1.29 75.62 866
Euro/Dollar 1.3403
Dollar/Yen 83.42
TOCOM prices in yen per gram. Spot prices in $ per ounce.
(Reporting By Rujun Shen; Editing by Ed Lane)
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