(Updates prices)
By Lewa Pardomuan
SINGAPORE, April 16 (Reuters) - Gold reversed early losses
on Wednesday to extend an oil-fuelled rally from the previous
day, but dealers expect volatility to persist with a firming
U.S. dollar weighing on sentiment.
Gold <XAU=> hit a low of $924.00 an ounce before short
covering pushed it up to $929.40/930.60 an ounce, higher than
late New York levels of $927.60/928.40 an ounce.
Oil's <CLc1> record high above $114 a barrel on Tuesday
lifts gold's appeal as a hedge against inflation.
Bullion has retreated from a record high of $1,030.80 an
ounce on March 17 to a two-month low of $872.90 in early April,
and is struggling to retest key resistance of $950.
"You couldn't rule out the possibility of a return to the
$800s. With gold and with other metals, you should never say
never," said David Moore, an analyst at Commonwealth Bank of
Australia in Sydney.
"If the Fed does cut rates further, that would be, I think,
a supportive factor for the gold price," he said.
Gold has risen more than 20 percent this year on
speculative buying ignited by rising oil prices and U.S.
interest rate cuts, which reduce the dollar's strength.
But the dollar is finding support now, raising the price of
gold for buyers using currencies other than the dollar.
The euro steadied at $1.5795 <EUR=>, hovering below a
record high of $1.5915 hit on Thursday, after surprisingly
robust U.S. inflation and manufacturing data suggested the
Federal Reserve may be less aggressive in cutting interest
rates.[]
Data on U.S. consumer prices for March will be released on
Wednesday, with markets expecting a core CPI reading of 0.2
percent for the month and 2.4 percent year-on-year -- above the
Fed's comfort zone.
In the physical sector, dealers noted light buying from
jewellers in India and Vietnam but Indonesia stayed on the
sidelines after being a seller in the last few days.
"I guess people are waiting for tonight's data. I would say
trading is rangebound at the moment after it failed to stay
above $930," said a dealer in Singapore.
Gold futures for June delivery <GCM8> on the COMEX division
of the New York Mercantile Exchange added $0.9 an ounce to
$932.9.
"When all players are already long, there's no-one left to
buy gold unless the price is coming down," said a dealer in
Singapore.
"However, any pullback might be quickly recovered. I expect
a volatile range of between $905 and $940 an ounce."
In other precious metals, silver fell below New York
levels, platinum hovered below $2,000, while sister metal
palladium bounced.
Precious metals prices at 0655 GMT
Metal Last Change Pct chg YTD pct chg
Turnover
Spot Gold 929.40 1.40 +0.15 11.61
Spot Silver 17.87 0.03 +0.17 20.99
Spot Platinum 1970.00 0.00 +0.00 29.61
Spot Palladium 452.00 5.00 +1.12 22.83
TOCOM Gold 3056.00 7.00 +0.23 -0.13
36707
TOCOM Platinum 6304.00 -16.00 -0.25 18.07
23177
TOCOM Silver 589.00 4.90 +0.84 8.87
524
TOCOM Palladium 1511.00 -23.00 -1.50 11.84
1219
Euro/Dollar 1.5845
Dollar/Yen 101.52
TOCOM prices in yen per gram, except TOCOM silver which is
priced in yen per 10 grams. Spot prices in $ per ounce.
(Editing by )
