* Gold rises to near 2-week highs
* Oil up more than $1 on supply worries
* Physical demand from India and Southeast Asia helps
(Updates prices, adds closing in Tokyo)
By Lewa Pardomuan
SINGAPORE, Aug 29 (Reuters) - Gold rose nearly $7 the back
of firmer oil prices on Friday, hovering near its highest level
in more than two weeks, with demand from jewellers ahead of the
festive season in Asia also offering additional support.
India, the world's largest consumer, is stepping up
purchases ahead of the festive season which will peak in
October with Diwali, the Hindu festival of lights. Buying
before the Muslim fasting month of Ramadan in September also
spurred trading.
Gold XAU= firmed to $838.15/839.15 an ounce from
$831.45/832.65 an ounce late in New York. Gold jumped to
$844.00 an ounce on Thursday, its highest level since Aug. 11,
before paring some due to a firming U.S. dollar.
Supply of gold bars remained tight in Singapore, which was
due to slow arrivals of stocks from refiners in Europe, said
Beh Hsia Wah, a dealer at United Overseas Bank.
"The premium is pretty high. The European side says supply
may be back to normal by mid-September but I am not too sure
about that," she said.
Premiums for gold bars were steady at this year's high of
between $1.20 and $1.80 to the spot London prices.
<GOLD/ASIA1>.
Dealers expected gold to trade in volatile $830 to $845
range amid low volumes ahead of Monday's Labor Day holiday in
the United States.
"If anything, gold promises to remain volatile. In the near
term, gold-price movements will continue to reflect the ups and
downsin the U.S. dollar/euro exchange rate," said Jeffrey
Nichols, managing director of American Precious Metals
Advisors. The dollar slipped against a basket of currencies
on profit taking and after oil CLc1 rose more than $1 to $117
a barrel on worries about possible supply disruptions caused by
Tropical Storm Gustav. [USD/]
Gold has bounced as much as 9 percent since tumbling to
nine-month lows around $773 two weeks ago, on high oil prices
and demand from jewellers in Asia and other parts of the world.
But gold is trading below a record high of $1,030.80 hit in
March.
STRONG DEMAND FROM INDIA
"I've noticed that Indian housewives are far better
forecasters of the gold price than most of us paid to do the
job -- and,today, Indian housewives are buying the yellow
metal," said Nichols of American Precious Metals Advisors.
"Fortuitously, physical demand has picked up sharply in the
past month, particularly among retail investors. We've seen
this in India where jewellery demand has picked up early in
response to low prices ahead of the coming festival season."
The new benchmark contract on the Tokyo Commodity Exchange,
August 2009 JAUc6, ended 7 yen per gram higher at 2,944 yen.
New York gold futures GCZ8 added $6.1 an ounce to $843.30.
Spot platinum XPT= fell to $1,464.50/1,484.00 an ounce
from $1,469.00/1,489.00 late in New York on Thursday.
Platinum, which plummeted to 11-month lows around $1,296
last week, has suffered from expectations car demand will slow
as the global economy falters, cutting demand for
autocatalysts.
Spot palladium XPD= rose to $294.50/302.50 an ounce from
$289.00/297.00 an ounce. Silver XAG= firmed to $13.80/13.86
an ounce from $13.64/13.70 an ounce.
Precious metals prices at 0033 GMT
Metal Last Change Pct chg YTD pct chg
Turnover
Spot Gold 837.10 3.85 +0.46 0.53
Spot Silver 13.78 0.15 +1.10 -6.70
Spot Platinum 1464.50 -2.00 -0.14 -3.65
Spot Palladium 296.00 7.00 +2.42 -19.57
TOCOM Gold 2944.00 7.00 +0.24 -3.79
28813
TOCOM Platinum 5075.00 59.00 +1.18 -4.94
19904
TOCOM Silver 485.90 -0.30 -0.06 -10.18
870
TOCOM Palladium 1055.00 16.00 +1.54 -21.91
546
Euro/Dollar 1.4752
Dollar/Yen 108.54
TOCOM prices in yen per gram, except TOCOM silver which is
priced in yen per 10 grams. Spot prices in $ per ounce.
(Editing by)
