* Gold posts biggest percentage gains in three months
* ISM survey highlights potential inflationary pressures
* ETF Securities' U.S. platinum fund sees 30,000-oz inflow
(Recasts, updates comments, closing prices, market activity,
adds NEW YORK to dateline)
By Frank Tang and Jan Harvey
NEW YORK/LONDON, Feb 1 (Reuters) - Gold rose 2 percent on
Monday, posting its biggest daily gain in three months, as a
combination of oil rally, dollar weakness and strong U.S. data
boosted bullion's investment appeal.
Platinum and palladium climbed to their highest in a week
after ISM data showed that U.S. manufacturing expanded for the
sixth straight month in January, and as metals holdings in U.S.
exchange-traded funds reported strong inflow. []
"The ISM manufacturing number was good. There is the
suggestion of inflationary pressures coming through," said
Robin Bhar, analyst at Calyon.
Gold is used as a hedge against inflation, which decreases
purchasing power in an investment portfolio.
Spot gold <XAU=> was last at $1,106.50 an ounce at 2:41
p.m. EST (1941 GMT) against $1,079.20 late in New York on
Friday. Earlier in the session, it traded as high as $1,106.75,
the strongest price since Jan. 21.
Spot bullion's more than 2 percent gain on Monday was its
biggest since Nov. 3, according to Reuters data.
U.S. gold futures for April delivery <GCJ0> on the COMEX
division of the NYMEX settled up $21.20, or 2 percent, at
$1,105 an ounce.
Recovery in risk appetite has lifted oil and global
equities prices, which all posted sharply higher prices,
analysts said.
Gold prices remain vulnerable to further losses, however,
after falling 1.6 percent in January, analysts said, with the
dollar's upward trend expected to resume.
"People have been seeking out gold as a currency hedge, and
if that is no longer needed, that is going to cap some of the
demand for gold," said Citigroup analyst David Thurtell.
Holdings of the world's largest gold-backed exchange-traded
fund, the SPDR Gold Trust <GLD> were unchanged on Friday, but
down 21.7 tonnes or 1.9 percent in January. []
PLATINUM RISES ON DATA, ETF
Among other precious metals, platinum <XPT=> was at $1,546
an ounce versus Friday's late New York quote at $1,500, and
palladium <XPD=> was at $427.50 versus $413.
Both platinum and palladium hit their highest in a week.
"When you see strong industrial data, that is particularly
positive for platinum and palladium due to their industrial
characteristics," said Bill O'Neill, partner at LOGIC
Advisors.
O'Neill said there is no question that the ETF provides a
new bullish influence for platinum prices.
Holdings of ETF Securities' U.S.-based platinum
exchange-traded fund <PPLT.P>, launched last month, rose just
over 30,000 ounces or 14 percent on Friday from its previous
session, the company said.
Barclays Capital analyst Suki Cooper said during a
conference call on Monday that she believes platinum group
metals are set to outperform gold and silver this year.
"The launch of physically backed exchange-traded funds,
coupled with expectations for auto sales to improve... is
likely to bode well for PGMs, while expectations for the dollar
to strengthen... are less positive for gold and silver," she
said.
Silver <XAG=> was at $16.64 an ounce against $16.16
Close Change Pct 2009 YTD
Chg Close % Chg
US gold <GCJ0> 1105.00 21.2 2.0 1096.20 0.8
US silver <SIH0> 16.660 0.470 2.9 16.845 -1.1
US platinum <PLJ0> 1539.30 33.30 2.2 1471.00 4.6
US palladium <PAH0> 428.55 15.90 3.9 408.85 4.8
Prices at 2:59 p.m. EST (1959 GMT)
Gold <XAU=> 1105.30 26.10 2.4 1096.35 0.8
Silver <XAG=> 16.62 0.46 2.8 16.84 -1.3
Platinum <XPT=> 1547.00 47.00 3.1 1465.50 5.6
Palladium <XPD=> 427.50 14.500 3.5 405.50 5.4
Gold Fix <XAUFIX=> 1086.50 4.50 0.4 1104 -1.6
Silver Fix <XAGFIX=> 16.23 -6.00 -0.4 16.99 -4.5
Platinum Fix <XPTFIX=> 1520.00 4.00 0.3 1466 3.7
Palladium Fix<XPDFIX=> 424.00 5.00 1.2 402 5.5
(Additional reporting by Pratima Desai in London; Editing by
Lisa Shumaker)
(Reporting by Frank Tang)
