* China raises reserve rate requirements
* Oil rise stokes concerns about inflation
* Investors nervous about violence in Bahrain
(Recasts, previous SINGAPORE)
By Rebekah Curtis
LONDON, March 18 (Reuters) - Gold rose 1 percent on Friday,
as the United Nations authorisation of military attacks in Libya
boosted gold's status as a shelter from risk, while investors
eyed whether intervention in the yen could calm markets jitters.
Gold hit a session high of $1,416.80 an ounce, trading at
$1,415.00 at 1059 GMT from $1,402.40 late in New York on
Thursday. The metal was little moved by news China's central
bank would raise lenders' required reserves by 50 basis points.
[]
Bolstering bullion, the U.N. approved military action to
contain Libyan leader Muammar Gaddafi, heightening geopolitical
tensions in the oil-rich region and lifting crude prices, while
unrest in Bahrain also unnerved investors. []
[]
Japan's battle with a nuclear crisis after Friday's
earthquake and tsunami there has also shaken confidence in
global markets this week. <nTOPNOW4>
"The uncertainty across the different global centres is
still there and that should support precious metals," said Saxo
Bank analyst Ole Hansen.
In the wake of the crisis, Japan bought billions of dollars
to restrain a soaring yen and traders reported intervention by
European central banks, kicking off joint action by the world's
richest nations to calm markets. []
In recent sessions risk aversion mounted to such heights
that even gold, traditionally a safe haven from risk, was no
exception to the broad sell-off from risk as investors sold the
metal to cover losses elsewhere.
"When everything turns into risk adversity mode no one stays
clear of that and the same thing happened for precious metals,"
Hansen said.
But potential stability in the yen may soothe investors.
"The yen probably holds the key now," Hansen added. "If they
manage to keep the yen at these levels that could help stabilise
the markets in general and also gold."
CHINA MOVE
China's central bank announced it would raise lenders'
required reserves for the third time this year and the sixth
since November. [] []
The move increases the required reserve ratio for the
country's biggest banks to a record 20.0 percent, another step
in the government's campaign to control inflation.
Meanwhile, investors also sought shelter in gold as a haven
from inflationary pressures as Libya's crisis kept oil prices
strong. []
"Military action's always a concerning event for investors,"
Mitsubishi precious metals analyst Matthew Turner said of the
U.N. vote on Libya.
Brent crude <LCOc1> was up 0.5 percent, paring earlier gains
after China raised reserve rate requirements.
Spot silver <XAG=> was at $34.77 an ounce from $34.18,
platinum <XPT=> was at $1,711.50 an ounce from $1,697.49 and
palladium <XPD=> at $722.47 from $704.50.
(Editing by James Jukwey)
