LONDON (Thomson Financial) - Gold prices rose in subdued trading, thinned by Christmas holidays, having gained around 3 pct last week, and the metal is expected to remain in a tight range.
Strong oil prices, which have almost doubled this year, underpinned the precious metal. But, strength in the dollar, which firmed last week, capped gains.
Gold moves in line with oil prices as it is bought as a hedge against energy-led inflation, and in the opposite direction to the dollar as it is seen as an alternative asset. The dollar was hovering near a six-week high against the yen last seen Friday. Elsewhere, the euro was steady against the dollar after recent falls, with thin holiday trade limiting further dollar gains for the time being.
At 12.16 pm, spot gold was trading at 811.90 usd per ounce against 811.80 usd in late New York trades Friday.
'Most markets volumes have been extremely thin, with many closing early for the Christmas holidays,' said TheBullionDesk.Com analyst James Moore. 'The metal is unlikely to move much from the 808-812 usd area,' he added.
In other precious metals, platinum was lower at 1,521 from 1,522 an ounce Friday, having hit a day high of 1,529.50 usd earlier. The white metal struck an all time record of 1,531 usd per ounce last week.
'Given the current market tightness and the vulnerability to supply disruptions platinum could easily surge to fresh records, and is expected to remain strong across 2008,' said Moore.
In its Interim 2007 Platinum Review released in November, specialist materials group Johnson Matthey said the world's platinum needs are outpacing supply and that output woes and continuing demand should underpin the price.
Compared to last year's levels, global platinum demand is set to rise this year by 195,000 ounces or 2.9 pct to a record 6.925 mln ounces, said the group.
Elsewhere palladium dipped to 352 usd from 354 usd per ounce, while silver eased to 14.34 usd from 14.35 usd. anealla.safdar@thomson.com as/lht/as/cmr COPYRIGHT Copyright Thomson Financial News Limited 2007. All rights reserved. The copying, republication or redistribution of Thomson Financial News Content, including by framing or similar means, is expressly prohibited without the prior written consent of Thomson Financial News.
© 2007 AFX News
