* Dollar hits near 2-week low vs currency basket, oil rises
* SPDR gold ETF sees outflow
(Releads, updates prices, adds comment)
By Jan Harvey
LONDON, July 15 (Reuters) - Gold jumped more than 1 percent
to a two-week high of $935.60 an ounce on Wednesday as the
dollar's slip against a basket of currencies pushed prices
through key resistance levels at $931 an ounce.
Silver tracked gold higher, rising to a session peak of
$13.30 an ounce and reversing much of the slide that took the
grey metal to a 10-week low earlier this week.
Spot gold <XAU=> was bid at $933.80 an ounce at 1134 GMT,
against $924.60 an ounce late in New York on Tuesday. Silver
<XAG=> was at $13.24 an ounce against $12.88.
"It seems that many stops had been triggered above $930,"
said Alexander Zumpfe, a trader at precious metals house
Heraeus. "The weaker dollar definitely helped on the way up."
The dollar fell to a two-week low against a basket of
currencies on Wednesday, as currencies seen as higher risk
benefited from a more upbeat tone to the markets after strong
earnings from Goldman Sachs and Intel the previous day. []
The euro-dollar exchange rate moved towards $1.41 as risk
appetite improved. Gold becomes more attractive as a currency
hedge as the dollar weakens.
Healthier risk appetite also boosted assets such as equities
and other commodities. Global stocks rose to their highest level
in nearly two weeks on Wednesday, while U.S. stock futures
pointed to a higher opening on Wall Street. [] []
"At the moment the linkage between risk appetite and the
U.S. dollar is clear -- the U.S. dollar rallies when equities
are under pressure and vice versa," UBS analyst John Reade said
in a note.
"If this were to change, such that the dollar were to fall
during a period of risk aversion, then gold could do very well
indeed, as the two buying forces -- risk aversion and a hedge
against the USD -- would then be combined rather than opposing."
He said this was only likely to happen if confidence were
lost in the dollar as a reserve asset, which is seen as
unlikely.
ASSET CLASS
Oil rose above $60 a barrel, lifted by data that showed
crude oil and gasoline stockpiles fell last week, as well as
gains on other markets. Base metals also climbed, showing strong
interest in commodities as an asset class. [] []
Traders are awaiting the release of the U.S. June consumer
price index, a key inflation gauge, at 1230 GMT.
The figures could have an impact on the currency markets,
which may impact gold, while signs of rising inflation may boost
interest in bullion as a hedge against rising prices.
However, demand for physical gold from jewellers and to back
exchange-traded funds was lacklustre. The largest gold ETF, New
York's SPDR Gold Trust <GLD>, saw an outflow of more than 15
tonnes or 1.4 percent on Tuesday.
Jewellery demand in the world's largest bullion consumer,
India, was also sluggish as buyers awaited lower prices. "There
could be more buying if prices decline below the $900 an ounce
level," said one dealer in a state-run bank. []
Among other precious metals, platinum <XPT=> was at $1,150
an ounce against $1,127.50, while palladium <XPD=> was at $244
against $241.
(Reporting by Jan Harvey; Editing by Anthony Barker)
