(Updates prices, adds quotes, closing in Tokyo)
By Lewa Pardomuan
SINGAPORE, Jan 25 (Reuters) - Gold and platinum hit all-time
highs on Friday after a power crisis closed South African mines,
with dollar weakness, firm oil and expectations of more interest
rate cuts in the United States providing additional support.
South Africa's three main gold producers and the world's
biggest platinum miner suspended production at all their mines
in the country on Friday due to a power crisis, helping send
precious metal prices to new highs. []
Spot gold <XAU=> hit an intraday high of $922.40 an ounce,
surpassing last week's record and up more than 8 percent since
tumbling to a three-week low around $850 this week. Gold was
last quoted at $907.00/907.70 in New York on Thursday.
"It's pointing at $950. Now there's a power
shortage...everything is in favour of gold for the time being,"
said Ronald Leung, director of Lee Cheong Gold Dealers in Hong
Kong, referring to the power crisis in South Africa.
Gold could undergo a correction after a U.S. Federal Reserve
meeting on interest rates next week but the downside could be
limited to $880 or $900. "I don't expect it to go down to $850
again if there's a correction this time," he said.
Platinum <XPT=> also hit an historic high at $1,652 an ounce
on investment demand and gains in gold. The metal was last
quoted at $1,606/1,611 an ounce in New York.
Trading in Tokyo's gold and platinum futures <0#JAU:>
<0#JPL:> ended after they rose to their daily limit of 120 yen
per gram.
"Platinum is confronted by a big supply and demand problem.
The price will be very strong in the future. Within a month, the
next price target is $1,650," said Yukuji Sonoda, precious
metals analyst at Daiichi Commodities in Tokyo.
Miners in South Africa, the world's largest platinum
producer, have had to deal with electricity outages as power
utilities struggled to keep up with rising demand.
On Thursday, Lonmin, the world's No.3 platinum producer, cut
its sales outlook for the year after first-quarter refined
platinum output slid by nearly a fifth due to safety shutdowns
and persistent processing problems.[]
Sonoda said expectations of further U.S. interest rates
cuts, which have underpinned a recovery in stocks markets after
a rout at the start of the week, have encouraged investors to
buy commodities.
"That's a very good environment. By the end of June, gold
will reach $1,000," said Sonoda, who also expected more
investors to shift to gold from government bonds.
Gold had tumbled to a three-week low of $849.50 on Tuesday
as falling energy and equity prices forced investors to sell the
metal to cover margin calls, but the Dow Jones industrial
average <> has since recorded two consecutive days of gains
on hopes for interest rate cuts and a fiscal stimulus package.
Fed policy makers are scheduled to meet on Jan. 29-30. A
hefty emergency rate cut this week boosted sentiment in precious
metals. The euro rose to $1.4745 <EUR=>.
Oil <CLc1> gained more than $1 a barrel after U.S. lawmakers
confirmed an economic stimulus plan that helped quell fears of a
recession.
COMEX gold futures extended gains, with the most active
February contract <GCG8> hitting a record $923.40 an ounce.
The physical sector came to standstill in Hong Kong, but
bullion dealers in Singapore saw sales of scrap from jewellers
in Indonesia, which is Southeast Asia's largest gold consumer.
Gold bars were offered at a discount of 20 U.S. cents to the
spot London price in Hong Kong, unchanged from last week. Gold
bars were on par in Singapore <GOLD/ASIA1>.
Silver <XAG=> hit a high of $16.61 an ounce, its best level
since December 1980, up from $16.35/16.40 in New York. Palladium
<XPD=> rose to $380.50/385.00 an ounce from $370.50/375.50.
Precious metals prices at 0944 GMT
Metal Last Change Pct chg YTD pct chg Turnover
Spot Gold 918.50 11.50 +1.27 10.30
Spot Silver 16.52 0.14 +0.85 11.85
Spot Platinum 1652.00 43.00 +2.67 8.68
Spot Palladium 376.00 5.00 +1.35 2.17
TOCOM Gold 3186.00 120.00 +3.91 4.12 120700
TOCOM Platinum 5350.00 120.00 +2.29 0.21 9404
TOCOM Silver 573.10 22.00 +3.99 5.93 1523
TOCOM Palladium 1310.00 40.00 +3.15 -3.03 930
Euro/Dollar 1.4741
Dollar/Yen 107.60
TOCOM prices in yen per gram, except TOCOM silver which is
priced in yen per 10 grams. Spot prices in $ per ounce.
(Editing by Peter Blackburn)
