* Gold climbs on safe haven buying, rising oil
* Iran missile test-fire supports gold, crude
* Platinum recovers from two-month low
(Updates with New York and late prices and comments)
By Jan Harvey and Carole Vaporean
LONDON/NEW YORK, July 9 (Reuters) - Gold firmed on
Wednesday as reports Iran had test-fired missiles lifted oil
prices and prompted buying of bullion as a safe haven play.
Spot gold <XAU=> advanced to $926.90/928.10 an ounce by
3:25 p.m. EDT (1925 GMT) from $921.35/922.55 an ounce in late
Tuesday trade in New York. Earlier, the precious metal shed 1
percent to a near two-week low of $912.50 as oil prices fell.
"The prices are holding up because of a risk premium
generated by the tensions in the Middle East," said commodity
analyst Manqoba Madinane at Standard Bank in Johannesbourg.
"Oil prices have increased from yesterday's levels and
that's also supporting the upside on gold," he said.
Iran test-fired nine missiles on Wednesday and warned the
United States and Israel it was ready to retaliate for any
attack over its disputed nuclear projects.[]
August futures <GCQ8> finished $5.30 higher at $928.60 an
ounce on the COMEX division of New York Mercantile Exchange,
after a choppy trading session.
The August contract's trading range narrowed to between
$917.20 and $930.50 a tonne, but its seesaw trading pattern
left many players waiting for a break out point one way or the
other to determine near-term direction, traders said.
"Gold is still waiting for a key break out point one way or
the other to determine near-term direction. So it's been fairly
choppy trading," said one New York gold trader.
Early in the session, oil rose $2 to around $138 a barrel,
after Iran said it had test-fired missiles that could reach
Israel and U.S. bases in the region but pared gains to end up
just one cent at $136.05 as demand worries weighed.[]
Rising oil prices increase gold's appeal as an inflation
hedge and boost sentiment towards commodities as an asset class
while rising tension in the Middle East attracts safe-haven
buying.
"Gold benefits directly from geopolitical tension, so it
would have received support from that news," said Merrill Lynch
metals strategist Daniel Hynes.
The U.S. dollar weakened, as oil prices rebounded and
geopolitical tensions resurfaced with news Iran test-fired
missiles and unknown gunmen attacked the U.S. consulate in
Turkey.[]
A lower dollar tends to benefit the precious metal, which
is often bought as a hedge against currency weakness and so
moves in the opposite direction to the greenback.
OTHER METALS
Among other precious metals, spot platinum <XPT=> firmed to
$1,958.50/1,978.50 an ounce from $1,940.50/1,960.00 late in New
York. It hit a two-month low of $1,936.50 on Tuesday on fears a
slowing U.S. economy could weaken demand from car makers.
Spot palladium <XPD=> was also higher at $442.0/450.0 per
ounce, up from 437.50/445.50 on Tuesday.
"(Palladium) price movements correlate to platinum,
although long term fundamentals are substantially weaker,"
noted Marc Elliott, an analyst at investment bank Fairfax.
Spot silver <XAG=> added to gains at $18.09/18.15 an ounce
by 3:04 p.m. EDT, up from $17.82/17.88 an ounce in late Tuesday
dealings.
(Additional reporting by Carole Vaporean in New York, Humeyra
Pamuk in London; Editing by Marguerita Choy)
