* Gold climbs to one-week high
* Platinum off highs on South Africa power tariff hike
* Dollar slips against euro and yen
(Recasts, adds comment/detail, changes dateline, pvs Singapore)
By Naveen Thukral and Pratima DEsai
LONDON, June 19 (Reuters) - Gold climbed to its higehst
level in more than a week on Thursday as the weakening dollar
added impetus to investors buying the precious metal to protect
their assets against inflation.
Gold <XAU=> hit $895.05 an ounce, its highest since June 9,
and was at $888.10/889.10 an ounce at 1020 GMT from
$890.75/891.95 late in New York on Wednesday, when it jumped
nearly $7 on a falling dollar and higher oil prices.
"The dollar is a supportive factor for gold ... Inflation
concerns are still prominent, there will be some safe-haven
buying," said Suki Cooper, analyst at Barclays Capital.
A lower U.S. currency makes metals priced in dollars cheaper
for holders of other currencies, while gold is seen as a store
of value during times of inflation, which is threatening to turn
into a spiral.
The dollar <EUR=> fell against the euro as the market scaled
back its expectations of aggressive rate rises from the U.S.
Federal Reserve, given poor growth prospects and the crisis in
the banking sector. []
"Gold prices have been able to rally recently in large part
because the U.S. Federal Reserve and European Central Bank
softened their anti-inflation rhetoric," HSBC said in a note.
"Thus reducing the prospect of imminent monetary policy
tightening and allowing financial markets to re-evaluate the
chances of a U.S. rate rise."
PLATINUM UNDERPINNED
Gold hit a record of $1,030.80 on March 17 before a broad
sell-off in commodities dragged down prices.
Oil steadied on Thursday, supported by a further production
outage in Nigeria and as a top U.S. investment bank raised its
oil price forecast. U.S. crude <CLc1> was down 37 cents to
$136.31 a barrel. <O/R>
Platinum was off intraday highs but underpinned by supply
worries after South Africa's power regulator approved an
additional 13.3 percent tariff rise for state-owned power firm
Eskom [] on Wednesday. []
"Platinum we think has the strongest fundamentals within the
precious metals complex, especially now as we've entered peak
demand period for power in South Africa," Barclays Capital
analyst Cooper said.
"Power problems in South Africa haven't been resolved and
that will keep the market on tenterhooks."
Spot platinum <XPT=> was down at $2,068/2,088 an ounce from
$2,080.50/2,100.50 on Wednesday. It rallied to $2,103.50 an
ounce on Wednesday, its highest since May 28.
A power shortage in South Africa, the world's top producer
of the metal used in autocatalytic converters, sparked worries
about a supply deficit and propelled prices to an all time high
of $2,290 in early March.
Spot palladium <XPD=> rose to $464.00/472.00 an ounce from
$466.00/474.00 on Wednesday. Silver <XAG=> gained to
$17.27/17.32 an ounce from $17.05/17.13.
(Editing by David Evans)
