* Friday seen critical whether gold can hold $1,000
* SPDR Gold holdings <XAUEXT-NYS-TT> steady
By Miho Yoshikawa
TOKYO, Sept 11 (Reuters) - Gold rose above $1,000 on Friday
as the precious metal continued to benefit from a weaker dollar
amid growing risk appetite and inflation fears due to stronger
oil prices.
The precious metal topped $1,000 an ounce on Tuesday for the
first time since February, with spot gold staging a stunning run
to an 18-month high of $1,007.45 on the same day, on technical
buying momentum and a slide in the dollar.
News that Barrick Gold <ABX.TO><ABX.N> was cutting its
hedgebook of forward gold sales also helped fuel gains.
[]
"Fears about inflation are what is providing the support in
the market now," said Kazuhiko Saito, chief analyst at Fujitomi
Co Ltd.
Gold <XAU=> was at $1,001.50 per ounce at 0531 GMT, up 0.6
percent from the notional New York close of $995.50.
U.S. gold futures for December delivery <GCZ9> were at
$1,003.4 per ounce, up 0.7 percent.
December gold futures rose on Tuesday to as high as
$1,009.70, their highest since February.
It remains to be seen, however, whether gold will be able to
maintain these lofty levels, or mark new highs.
Saito said gold's performance on Friday, when there was a
possibility it could fall in fund profit-taking, would be
crucial.
"Whether gold manages to hang on to $1,000 today will be
important," he said.
The dollar hit a seven-month low against the yen on Friday
after solid Chinese economic data triggered dollar-selling
against higher-yielding currencies and other majors. []
The dollar extended losses to hit its lowest level this year
against the euro on Friday as broad dollar selling gathered pace
following Chinese data that buoyed hopes for the global economy.
A weaker dollar enhances gold's allure as an alternative
asset, a factor which has helped fuel this week's rally.
Oil prices rose to top $72 a barrel on Friday, extending the
previous session's four-day rally after a U.S. report showed a
surprise decline in crude stockpiles and OPEC said it would
maintain official output curbs. []
Data on Friday showed the global economy was on track to lift
itself out of its slump.
Widely awaited figures showed China's industrial output
expanded in August at the fastest rate in 12 months and narrowly
topped forecasts, showing it was well on the road to recovery.
[]
Other figures issued on Friday showed China's exports in
August fell by about 20 percent from a year earlier, and a top
Chinese planning official said the country's economic recovery
fundamentals are not solid. []
However, Friday's data proved solid enough to erase worries
about the state of the Chinese economy, traders said.
Japan's economy grew a revised 0.6 percent in the three
months to June, less than preliminary figures had shown but
confirming that the economy had crawled out of recession after a
full year of contraction. []
The unexpected downward revision was mostly due to falls in
inventories, which analysts took as a positive sign for the
world's No.2 economy.
Traders have pointed to a lack of physical buying of gold,
including by major consumer India, as a factor likely to
undermine the current rally.
There was a lack of fresh investment flows into the world's
largest gold-backed exchange-traded fund, the SPDR Gold Trust
<GLD>.
The latest data showed holdings in the SPDR Gold Trust <GLD>
stood at 1,077.63 tonnes, unchanged since Sept 4. []
PRICES
Precious metals prices at 0533 GMT
Metal Last Change Pct chg YTD pct chg Turnover
Spot Gold 1001.50 6.00 +0.60 13.79
Spot Silver 16.87 0.19 +1.14 49.03
Spot Platinum 1288.00 4.00 +0.31 38.20
Spot Palladium 291.00 2.50 +0.87 57.72
TOCOM Gold 2950.00 -12.00 -0.41 14.65 30926
TOCOM Platinum 3789.00 -18.00 -0.47 42.87 7603
TOCOM Silver 493.50 6.00 +1.23 54.56 440
TOCOM Palladium 857.00 -6.00 -0.70 55.82 436
Euro/Dollar 1.4614
Dollar/Yen 91.18
TOCOM prices in yen per gram, except TOCOM silver which is
priced in yen per 10 grams. Spot prices in $ per ounce.
(Additional reporting by Chikako Mogi; Editing by Michael
Watson)
