PRECIOUS-Gold edges up before Fed decision as jewellers buy
* Spot gold due to correct -technicals * Coming Up: U.S. FOMC rate decision; 1730 GMT (Updates prices, adds fresh quotes) By Lewa Pardomuan SINGAPORE, Jan 25 (Reuters) - Gold regained strength on Wednesday after an early dip spurred buying from jewellers in Asia, but prices were stuck in a range as investors awaited the outcome of the U.S. Federal Reserve's policy meeting, which could weigh on the dollar. The Fed, which will start a new practice of announcing policymakers' interest-rate projections, will probably conclude the meeting with a signal that interest rates will be held near zero into 2014, according to a Reuters poll. Any signs that interest rates will stay lower for longer could put pressure on the dollar, and boost gold's safe haven appeal, and prices. A weaker dollar would also make gold a more attractive buy for investors holding other currencies. Gold added $2.29 an ounce to $1,667.89 an ounce by 0637 GMT, off an intraday low of around $1,664 an ounce. Gold hit a 6-week high of $1,681.16 on Monday. "I am not sure about India, but yes, the Indonesians have been buying," said a dealer in Singapore, who also trades with top consumer India. "The Thais sold gold yesterday but they also bought back last night. Thailand is very much a market of their own." Volumes remained thin during China's week-long Lunar New Year holiday. "We've seen light buying from Indonesia, but we are still in a holiday mood. It looks like people will prefer to buy on dips. Premiums for gold bars are steady at $1," said another physical dealer in Singapore. "There's not much on silver, but we will still get demand from India or Thailand. We can't say if the demand is exceptionally good." Silver rose 23 cents to $32.24 an ounce. It rallied to $32.76 an ounce on Monday, its strongest since early December. Gold largely tracked the fortunes of the euro in the last two months of 2011, losing some of its safe haven appeal even as investors questioned the viability of the single currency. Gold fell by more than 10 percent in December. The euro fared reasonably well against the dollar on Wednesday after EU data showing surprising strength in manufacturing and services this month held out hope that the euro zone may escape recession. Greece kept hopes alive for a last-minute bond swap deal to avoid a messy default after euro zone officials sent talks back to square one by rejecting a final offer from the country's private bondholders. But the International Monetary Fund said Europe's debt crisis could tip the world economy into recession and a bigger firewall was urgently needed to keep the damage from spreading. U.S. February gold rose $3.5 an ounce to $1,668.0 an ounce. "After failing to crack the upside earlier this week, there is a chance it could take a look at support. We think that should hold. Indian and Thai investors are buying physical material towards the bottom of the range," ANZ said in a report. "This pattern may well continue for the rest of the week, with prices likely to trade towards the top of the band, and possibly through it, once Chinese markets reopen next week." Some Asian markets reopened on Wednesday but China and Hong Kong remained closed for the Lunar New Year holiday. Asian shares rose on Wednesday, underpinned by strong earnings from U.S. technology giant Apple, stabilising European money markets and falling euro zone debt yields, with investors shifting their focus to the Fed from Europe. Precious metals prices 0637 GMT Metal Last Change Pct chg YTD pct chg Volume Spot Gold 1667.89 2.29 +0.14 6.66 Spot Silver 32.24 0.23 +0.72 16.43 Spot Platinum 1549.50 4.76 +0.31 11.23 Spot Palladium 677.23 0.23 +0.03 3.79 COMEX GOLD FEB2 1668.20 3.70 +0.22 6.47 7687 COMEX SILVER MAR2 32.25 0.27 +0.84 15.51 1269 Euro/Dollar 1.3019 Dollar/Yen 77.93 COMEX gold and silver contracts show the most active months
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