(Updates prices, adds quotes)
By Lewa Pardomuan
SINGAPORE, April 30 (Reuters) - Gold extended losses on
Wednesday, hovering near a three-month low hit the previous
day, after the dollar surged against the euro, prompting
investors to liquidate some of their holdings.
Investors await the outcome of a meeting by the U.S.
Federal Reserve amid expectations it is ready to signal a pause
in its interest rate cutting, which in theory will support the
dollar but reduce gold's appeal as an alternative investment.
Gold <XAU=> dropped to $871.85/872.85 an ounce from
$873.55/874.75 an ounce late in New York on Tuesday, when it
tumbled to $868.20 an ounce, its lowest since late January, on
a combination of a rise in the dollar and a fall in oil.
Gold has lost more than 15 percent in value since spiking
to a record high at $1,030.80 on March 17. The drop has
attracted physical buying from jewellers, which may offer
support for gold, at least for now, said dealers.
"I'd suggest we're probably looking at a range for about
$868 as the next support, with that resistance now at the $875
level," said Darren Heathcote of Investec Australia in Sydney.
"There's been physical buying around. I'd suggest that
given that we are $60 or so lower than we were about a week
ago, it would have spurred some physical buying, thinking
there's a possibility of a further bounce."
The Federal Open Market Committee will unveil its decision
around 1815 GMT on Wednesday, when it is expected to cut rates
by a quarter percentage point to 2 percent, which would take
its total rate slashing over the past seven months to 3.25
percentage points.
"We've seen selling in Japan, and it looks gold will head
lower again but everything really depends on the FOMC
decision," said a dealer in Hong Kong.
"Maybe support will be around $870 in Asia," he said.
Gold futures for June delivery <GCM8> on the COMEX division
of the New York Mercantile Exchange fell $3.5 an ounce to
$873.1 an ounce.
The dollar barely changed at 104.05 yen <JPY=>, while the
euro was flat at $1.5570 <EUR=>, holding near a one-month low
of $1.5540 hit the previous day.
Spot platinum <XPT=> fell to $1,914/1,924 an ounce from
$1,918/1,938 late in New York.
Most active Tokyo platinum futures <0#JPL:> fell 250 yen
per gram to 6,200 yen.
Silver <XAG=> edged down to $16.49/16.56 an ounce from
$16.51/15.59 an ounce. Spot palladium <XPD=> inched down to
$420/428 an ounce from $421/429 an ounce.
Precious metals prices at 0342 GMT
Metal Last Change Pct chg YTD pct chg
Turnover
Spot Gold 870.70 0.65 +0.07 4.56
Spot Silver 16.49 -0.03 -0.18 11.65
Spot Platinum 1914.00 0.50 +0.03 25.92
Spot Palladium 420.00 1.50 +0.36 14.13
TOCOM Gold 2941.00 -80.00 -2.65 -3.89
28625
TOCOM Platinum 6204.00 -246.00 -3.81 16.20
14228
TOCOM Silver 557.70 -18.00 -3.13 3.09
729
TOCOM Palladium 1436.00 -74.00 -4.90 6.29
1122
Euro/Dollar 1.5567
Dollar/Yen 104.07
TOCOM prices in yen per gram, except TOCOM silver which is
priced in yen per 10 grams. Spot prices in $ per ounce.
(Editing by Ben Tan)
