* Gold up for a third day above $1,410/oz
* Palladium hits nine-year peak, silver at 30-year highs
* Coming up: U.S. initial jobless claims; 1330 GMT
(Updates throughout with comment, refreshes prices; changes
byline and dateline, pvs SINGAPORE)
By Amanda Cooper
LONDON, Dec 30 (Reuters) - Weakness in the U.S. dollar and a
year-end flurry of investment in commodities pushed gold to its
highest in three weeks on Thursday, while palladium hit fresh
nine-year highs after having almost doubled in price this year.
Silver shot to new 30-year peaks as it benefited from
strength in other industrial commodities, putting it on course
for an 83 percent gain this year, its strongest performance in
nearly 30 years.
The dollar weakened broadly after the largest one-day
decline in five-year Treasury yields <US5YT=RR> in three months
removed some of the currency's appeal to non-U.S. investors.
[]
Gold is set for its tenth consecutive annual gain, having
risen by nearly 30 percent in 2010, its strongest yearly
performance since a 31 percent gain in 2007 when the global
financial crisis began to unfold.
Spot gold <XAU=> was last at $1,412.45 an ounce by 1014 GMT,
having risen for three consecutive trading sessions to its
highest level since Dec. 7. Gold's inverse correlation to the
dollar index <.DXY> reached its strongest in eight weeks on a
30-day rolling basis.
"Overall, I don't think today or tomorrow we are going to
have any kind of correction as such," said Afshin Nabavi, MKS
Finance head of trading.
"I'm quite friendly towards it and probably feel that
tomorrow night we are going to end the year with some fireworks
as well."
BOOST TO GOLD
The euro zone debt crisis, which unfolded in April this year
and culminated in multi-billion euro international bailouts of
both the Greek and Irish governments, has been one of the prime
drivers of investment demand for gold.
Holdings of gold in the SPDR Gold Trust <GLD>, the world's
largest exchange-traded fund backed by physical bullion, have
risen by 15 percent this year to 1,284.062 tonnes, and a near 20
percent rise in open interest in U.S. gold futures also reflects
some of this investor desire to hold gold. [] <0#CFTC>
Gold prices were well supported after breaking above the key
$1,400 threshold earlier this week, helped by strong physical
demand in Asia.
Palladium notched up a fourth straight day of increases and
was set for a second year of gains, having almost doubled to
near $800 an ounce over the course of 2010 and is this year's
top performing commodity.
Analysts widely expect a surge in demand for palladium next
year, mainly from China, which boasts the world's largest auto
market that is dominated by gasoline-powered vehicles, which use
palladium in their catalytic converters.
The ratio of platinum to palladium has fallen to its lowest
in about eight years this year, mirroring palladium's
outperformance over platinum, which relies heavily on the
flagging European car market as a source of industrial demand.
Spot palladium <XPD=> rose to a nine-year high of $795.00
before trading back at $793.97, up 0.4 percent on the day, while
platinum <XPT=> rose to a session high of $1,767.5, its highest
since Nov 11, before holding steady at $1,756.74.
Silver <XAG=> hit a 30-year high of $30.88 an ounce, before
easing to $30.76, up 1 percent on the day.
In the penultimate trading day of the year, investors will
keep their eye on the weekly initial jobless claims data from
the United States to gauge the health of the world's largest
economy.
"If the initial claims data comes positive, it could prompt
some profit-taking in gold," said Ong Yi Ling, an analyst at
Phillip Futures.
(Additional reporting by Rujun Shen in Singapore, editing by
Jane Baird)
