* Gold rallies on currency-related buying
* Dollar turns higher on U.S. consumer data
* South African union rejects Anglo Platinum wage offer
(Recasts, updates with quotes, closing prices, adds NEW
YORK to dateline)
By Frank Tang and Jan Harvey
NEW YORK/LONDON, Aug 28 (Reuters) - Gold hit a three-week
high above $960 an ounce Friday on the back of strong
investment demand and buying linked to the initial dollar
weakness, but lackluster U.S. consumer sentiment data prompted
profit-taking in the metal.
The price of gold has been largely confined to a trading
range between $930 and $960 in the past three months, as the
metal was pressured by a resurgent dollar but supported by
long-term inflation worries and lingering economic
uncertainties.
"The precious metals rallied on playing catch-up to the
dollar weakness from yesterday afternoon, as well as bullish
technical signals," said Miguel Perez-Santalla, vice president
of sales at Heraeus Precious Metals Management in New York.
Gold futures, however, retreated from session highs as a
mixed bag of economic indicators, including a drop in U.S.
consumer sentiment, prompted the dollar to turn higher against
the euro late in the session.
The dollar typically moves in the opposite direction to the
metal.
U.S. December gold <GCZ9> rose to a session high of
$964.60, its loftiest price since Aug. 7. It settled up $11.50,
or 1.2 percent, at $958.80 an ounce on the COMEX division of
the New York Mercantile Exchange.
Spot gold <XAU=> at $956.40 an ounce at 2:06 p.m. EDT (1806
GMT), against $946.75 an ounce late in New York on Thursday.
Perez-Santalla said bullion holdings in gold
exchange-traded funds rose to a recent high on Thursday, and
selling of physical gold has also slowed down.
Holdings of Julius Baer's <BAER.VX> gold-backed
exchange-traded fund rose 43,600 ounces, or 2 percent, in the
week to Aug. 26. []
Saxo Bank senior manager Ole Hansen said that, in the near
term, the dollar will still predominantly be the currency that
is in the driving seat.
"That has managed to tip (gold) through a technical level
where new buying and short-covering has been triggered this
morning, and that has given us a bit of momentum on the
upside," Hansen said.
SILVER RISES
Silver was also helped by gains in base metals, with copper
up more than 4 percent. Silver, also used as an industrial
metal, was last at $14.76 an ounce from $14.24. []
Platinum was supported by a strike at South Africa's Impala
Platinum <IMPJ.J> and news that a union had rejected the latest
wage offer from Anglo Platinum <AMSJ.J>, the world's largest
producer of the metal. []
Platinum <XPT=> was at $1,243 an ounce against $1,240.50,
and palladium <XPD=> was at $285.50 against $284. South Africa
is the source of four-fifths of the world's platinum.
The National Union of Mineworkers said Implats, the world's
No. 2 platinum producer, had failed to secure a court order to
stop the strike. Some workers at its Rustenburg mine have been
on strike since Wednesday.
But a rise in platinum stocks after demand fell for the
autocatalyst material, news of capacity cuts from Toyota
earlier this week, and hopes industrial action will be resolved
quickly are limiting gains, analysts said. []
"The market reaction to these supply interruptions help
confirm our view that this is not an attractive tactical entry
point into new long platinum positions," said UBS analyst John
Reade in a note.
Close Change Pct 2008 YTD
Chg Close Pct Chg
US gold <GCZ9> 958.80 11.50 1.2 884.30 8.4
US silver <SIZ9> 14.815 0.564 4.0 11.295 31.2
US platinum <PLV9> 1245.90 5.40 0.4 941.50 32.3
US palladium <PAZ9> 292.35 5.60 2.0 188.70 54.9
Prices at 2:06 p.m. EDT (1806 GMT)
Gold <XAU=> 956.40 9.65 1.0 878.200 8.9
Silver <XAG=> 14.76 0.52 3.7 11.30 30.6
Platinum <XPT=> 1243.00 2.50 0.2 924.50 34.5
Palladium <XPD=> 285.50 1.50 0.5 184.50 54.7
Gold Fix <XAUFIX=> 955.50 12.50 1.3 836.50 14.2
Silver Fix <XAGFIX=> 14.540 0.340 2.4 14.760 -1.5
Platinum Fix <XPTFIX=> 1244.00 0.00 0.0 1529.00 -18.6
Palladium Fix <XPDFIX=> 289.00 0.00 0.0 365.00 -20.8
(Reporting by Frank Tang and Jan Harvey; Editing by Lisa
Shumaker)
