(Updates prices)
By Lewa Pardomuan
SINGAPORE, April 28 (Reuters) - Gold rose on Monday after
oil roared to another record high above $119 a barrel, but
investors may be careful about taking large position ahead of
this week's meeting on interest rates by the Federal Reserve.
Bullion XAU= rose to $891.40/892.40 an ounce from
$886.90/888.30 an ounce late in New York on Friday, as surging
oil prices CLc1 boosted the metal's appeal as a hedge against
inflation and helped it defy a firming dollar.
But gold has lost more than 13 percent in value since
spiking to a lifetime high of $1,030.80 an ounce on March 17.
It has been struggling to regain $900 and hit a three-week low
of $877.60 on Friday before rebounding after oil struck an
all-time peak.
"I think the key for gold would be how it shapes up after
the FOMC meeting," said David Moore, an analyst at Commonwealth
Bank of Australia in Sydney.
"I think at the moment, our expectation is the Fed will cut
rate by 25 basis points. How the U.S. dollar reacts to the
Fed's rates decision, I think, will be a key to the near-term
direction of gold," he said.
The Federal Open Market Committee will unveil its decision
around 2:15 p.m. EDT (1815 GMT) on Wednesday.
Gold has gained on speculative buying spurred by record
high oil prices and expectations of more rate cuts in the
United States, which reduces the dollar's appeal and makes gold
more appealing for investors seeking an alternative investment.
Gold futures for June delivery GCM8 on the COMEX division
of the New York Mercantile Exchange added $4.6 an ounce to
$894.3 an ounce.
"The support is holding for now but gold remains vulnerable
to further selling with the euro expected to weaken further.
The range for gold should be around $876-$910," Phillip Futures
said in a report.
The dollar hit a high of as 104.83 yen JPY= on trading
platform EBS, the highest since late February, on expectations
the Fed may stop cutting interest rates before the policy
meeting. The euro edged up to $1.5640 EUR= but held near a
three-week low of $1.5555 hit on Friday.
"There's short-covering after the market dropped a lot on
Friday. There's some physical buying but I think people had
bought a lot last week," said a dealer in Hong Kong, referring
to jewellery makers.
"I think people are just watching movements in the dollar.
If the dollar continues to strengthen, there's a possibility
gold will go down $875."
Premiums for gold bars were steady at 20 U.S. cents to the
spot London prices in Hong Kong <GOLD/ASIA1>.
Platinum XPT= rose to $1,969/1,975 an ounce from
$1,944/1,964 late in New York. It had fallen to $1,907 an ounce
on Friday, its lowest since early April.
The benchmark contract in Tokyo platinum futures <0#JPL:>,
April 2009, jumped nearly 3 percent to 6,442 yen per gram on a
weaker yen, up 157 yen from Friday's close.
Silver XAG= rose to $16.95/17.00 an ounce from
$16.83/16.89 an ounce. Spot palladium XPD= rose to $439/443
an ounce from $435.50/443.50 an ounce.
Precious metals prices at 0728 GMT
Metal Last Change Pct chg YTD pct chg
Turnover
Spot Gold 891.50 6.35 +0.72 7.06
Spot Silver 16.96 0.14 +0.83 14.83
Spot Platinum 1968.00 21.00 +1.08 29.47
Spot Palladium 438.00 0.50 +0.11 19.02
TOCOM Gold 3025.00 32.00 +1.07 -1.14
32953
TOCOM Platinum 6442.00 157.00 +2.50 20.66
20137
TOCOM Silver 576.00 15.10 +2.69 6.47
880
TOCOM Palladium 1506.00 27.00 +1.83 11.47
1415
Euro/Dollar 1.5643
Dollar/Yen 104.47
TOCOM prices in yen per gram, except TOCOM silver which is
priced in yen per 10 grams. Spot prices in $ per ounce.
(Editing by Ben Tan)
