(Updates to afternoon, adds comments)
By Chikafumi Hodo
TOKYO, Feb 7 (Reuters) - Platinum held near a record high
on Thursday as concerns over supply problems in South Africa
attracted strong demand from investors, with the strength in
Tokyo platinum futures providing additional support.
Cash precious metals have been confined to trading in tight
ranges, with gold <XAU=> around $900 an ounce, as many Asian
market participants were away for the Lunar New Year holiday.
By 0348 GMT, cash platinum <XPT=> was trading at
$1,811/1,821 an ounce, little changed from Wednesday's level of
$1,810/1,815 and not far from a record $1,819 reached the
previous day.
"Platinum is bullish as all focus is on supply worries in
South Africa with power cuts and floods and so on," said Shuji
Sugata at Mitsubishi Corp Futures and Securities in Tokyo.
"Concerns over supplies have been keeping lease rates at
high levels and providing overall support."
The white precious metal has been drawing huge funds
inflows since the start of the year, sending it up by nearly 20
percent.
South Africa's government appealed to mining companies for
help in cutting power consumption on Tuesday to ease a power
crisis caused by the failure of electricity generation to match
economic growth. []
Japanese investors have been flocking into the market,
although they were careful about building up new buy positions.
The distant December platinum contract on the Tokyo
Commodity Exchange <0#JPL:> rose more than 1 percent to as high
as 5,938 yen a gram, matching a record high reached on Tuesday.
Open interest in TOCOM platinum was at 71,599 contracts on
Wednesday, down about 26 percent from the start of the year.
Sharp volatility in TOCOM platinum and currencies have made
investors reluctant about taking new buy positions on rallies,
traders said.
Firmness in platinum prices have pushed up its sister
metal, palladium.
Palladium <XPD=> edged up to $419/424 an ounce from
$416/421 on Wednesday. It had reached a six-year high of
$426.50 on Tuesday.
Cash gold <XAU=> was trading at $900.00/901.25 an ounce,
little changed from $900.40/901.10 late in New York on
Wednesday, when it rose as high as $907.20.
"Gold appears to be losing momentum and struggling to rise
strongly above $900," Sugata said.
"It's tough to take fresh positions as uncertainties in
financial markets are spreading with stock prices losing ground
again. Also the market wants to the see the outcome of the G7
meeting before taking new positions in gold."
The Group of Seven finance ministers and central bank
governors are expected to debate how recent market turmoil and
a U.S. economic slowdown could affect the world economy when
they meet in Tokyo on Saturday.
COMEX gold futures were little changed in Asia after rising
1.7 percent in New York on Wednesday. The April contract <GCJ8>
was unchanged at $905.0 from the New York settlement.
Silver <XAG=> was steady at $16.49/16.54 an ounce from late
New York.
Precious metals prices at 0338 GMT
Metal Last Change Pct chg YTD pct chg
Turnover
Spot Gold 899.00 -1.40 -0.16 7.96
Spot Silver 16.49 -0.02 -0.12 11.65
Spot Platinum 1811.00 1.00 +0.06 19.14
Spot Palladium 419.00 3.00 +0.72 13.86
TOCOM Gold 3106.00 49.00 +1.60 1.50
26201
TOCOM Platinum 5924.00 93.00 +1.59 10.96
19172
TOCOM Silver 569.00 9.40 +1.68 5.18
403
TOCOM Palladium 1455.00 21.00 +1.46 7.70
927
Euro/Dollar 1.4615
Dollar/Yen 106.33
(Reporting by Chikafumi Hodo; Editing by Jan Dahinten)
