(recasts, adds quotes, changes prices, pvs SINGAPORE)
By Atul Prakash
LONDON, Feb 1 (Reuters) - Gold and platinum spiked to record
highs ahead of U.S. jobs data on Friday as supply concerns and
dollar weakness boosted investor sentiment.
Silver surged to a 27-year peak while palladium rose to its
highest level in 20 months, tracking strength in gold prices,
analysts said.
Spot gold <XAU=> rose as high as $934.70 an ounce and was
quoted at $933.35/934.05 at 1128 GMT, against $923.80/924.70 in
New York late on Thursday. It jumped 32 percent in 2007 and
another 12 percent so far this year.
Platinum <XPT=> set a record high of $1,744 an ounce.
"Power supply concerns continue to buoy prices and is likely
to remain a pivotal driver for prices in the medium term," Suki
Cooper, metals analyst at Barclays Capital, said, adding the
dollar and gold were likely to take cues from the jobs data.
"Our forex strategists note that given the dollar is trading
near its lows, the bigger reaction today is likely to come from
a downside surprise to payrolls," she said.
The dollar fell to hover near record lows against the euro
ahead of the data. The January jobs report, due at 1330 GMT,
along with factory activity figures, will offer investors more
clues to how close the world's largest economy is to recession.
Some analysts say the U.S. economy is already contracting,
and the massive reduction in interest rates over the last four
months of over two percentage points clearly shows the Federal
Reserve is worried too.
A weaker dollar makes gold cheaper for holders of other
currencies and often lifts demand for the metal, which is seen
as a hedge against political and financial difficulties.
David Thurtell, analyst at BNP Paribas, said no one was
willing to sell in any meaningful size, but there were plenty of
buyers in the market.
He said a weak dollar, stronger but shaky equities markets
and power problems in South Africa and China, the world's top
two gold producers, had lifted market sentiment.
Fresh electricity supply problems in South Africa hit hopes
in the mining sector on Thursday for an early return to full
production after a five day hiatus. []
State utility Eskom [] had agreed to ramp up supply
to the country's diamond, platinum, gold, coal and other mines
to 90 percent by Thursday, after a power shortage halted their
operations for the five days to Wednesday. []
In other bullion markets, U.S. April gold futures <GCJ8>
added $10.6 an ounce to $938.60.
RECORD HIGH PLATINUM
Platinum hit record highs as the protracted power crisis in
producer South Africa, which accounts for 80 percent of global
output, spurred buying from investors and auto makers.
Platinum <XPT=> jumped as high as $1,744/1,748 an ounce from
$1,730/1,735 late in New York on Thursday. The metal surged 37
percent in 2007 and added 14 percent more so far this year.
"We expect acute South African power problems to cost the
platinum industry about 200,000 ounces of platinum production in
the first quarter of 2008," John Reade, analyst at UBS
Investment Bank, said in a note.
"Long-term power issues and other operational factors are
expected to swell the platinum deficit to unsustainable levels,
unless jewellery demand is displaced by higher platinum prices."
UBS lifted its platinum price forecast to $1,800 an ounce in
2008, $2,100 the next year and $2,300 in 2010 from previous
predictions of $1,520, $1,450 and $1,375 respectively.
Silver <XAG=> rose as high as $17.21 an ounce and was last
quoted at $17.19/17.24, versus $16.91/16.96 in New York.
Palladium <XPD=> rose to $403/406 an ounce from $386/389.
(Reporting by Atul Prakash; editing by Michael Roddy)
