Gold flat near $1,060, weaker dollar supports
TOKYO (Reuters) - Spot gold was steady around $1,060 an ounce on Thursday, not far from the record high marked last week as it drew investors hedging against a weaker dollar and concerned over inflation stemming from strong oil prices.
Gold was at $1,058 per ounce at 0545 GMT, little changed from the notional close in New York of $1,058.35.
U.S. gold futures for December delivery were at $1,059.1 per ounce, down 0.5 percent.
Last week, spot gold soared to an all-time high of $1,070.40, while New York gold futures hit a record peak of $1,072 as the dollar's weakness spurred buying of gold.
A weaker dollar benefits gold as it makes it cheaper for holders of other currencies. It also enhances the metal's allure as a hedge against a depreciation in the U.S. currency.
"From a technical perspective, it looks like the precious metal is pausing and consolidating after reaching the highs of $1,070 an ounce," said Adrian Koh, an analyst at Phillip Futures.
"And if the general scenario doesn't change, as in a weakening dollar, then we could be in for a test of the record highs again when gold does break higher," he said.
The dollar was under pressure on Thursday, hovering near a 14-month low against a basket of currencies.
U.S. crude futures remained above $81 a barrel on Thursday, extending the previous session's gains on U.S. government data which showed a surprisingly large drawdown in gasoline inventories.
Buying by long-term investors has been slow, however.
The world's largest gold-backed exchange-traded fund, the SPDR Gold Trust, said its holdings stood at 1,108.094 tons as of October 21.
That marks a decline of 0.1 percent from two weeks ago when it rose to 1,109.314 tons on October 7.
India's gold sales for the Dhanteras festival, its biggest gold-buying day, could have risen by up to 30 percent from a benchmark, as consumers expecting the near-record prices to rise further bought freely.
Buying by India, a top consumer, has been slow until now, and has been seen as an illustration of weak physical demand.
The president of the Indian Bullion Market Association told Reuters on Thursday that record high gold prices above $1,000 an ounce may encourage more Indian buyers to turn to much cheaper silver.
Analysts said the rise in speculative net long positions to a record last week also makes gold vulnerable to a correction.
In industry news, Australia's Newcrest Mining Ltd (NCM.AX) reported a 5 percent decline in September quarter gold production on Thursday after mining lower gold-bearing ores at some mines.
ETF Securities USA filed a preliminary prospectus with the Securities and Exchange Commission on its proposed first-ever U.S. platinum exchange-traded fund (ETF).
