* Gold still rangebound between $1,660 and $1,680/oz
* Platinum discount to gold at narrowest in nine months
* Coming Up: U.S. Fed chief Ben Bernanke speaks; 2100 GMT
(Adds details, comments; updates prices)
By Rujun Shen
SINGAPORE, Jan 14 Gold edged up on Monday after
a sharp correction in the previous session, buoyed by a stronger
euro and physical buying from China, with expectations of
aggressive monetary easing in Japan also lending support.
The euro rose as much as half a percent in its third day of
gains, after the European Central Bank kept interest rates
unchanged and its chief struck a more optimistic tone on the
region's economic recovery late last week.
The dollar index dropped to its lowest level since
the beginning of the year. A weaker greenback makes
dollar-priced commodities more attractive for buyers holding
But moves in the currency market have done little to change
the sluggish mood in the gold market, with analysts expecting
bullion to range between $1,660 and $1,680 an ounce until
investors get better clues to the health of the global economy
and the direction of central banks' monetary policies.
Speculators cut their net long positions in gold to a
four-month low in the week to Jan. 8, data from the U.S.
Commodity Futures Trading Commission showed.
Buying from China, though, helped support sentiment.
"We see a fair amount of buying from China after gold prices
fell last Friday, and the yuan hit a record high (against the
dollar), making local prices cheap," said Peter Tse, director at
"Having said that, gold is still rangebound and I wouldn't
put too much on this morning's rise until liquidity returns when
the European market returns."
Spot gold rose 0.4 percent to $1,668.50 an ounce by
0756 GMT, after edging up 0.3 percent last week.
U.S. gold gained half a percent to $1,668.30.
Technical analysis suggested spot gold is expected to be
neutral so long as it remains in the range of $1,653-$1,678 an
ounce, said Reuters market analyst Wang Tao.
Japan's Prime Minister Shinzo Abe stepped up pressure on the
Bank of Japan to further ease its monetary policy, asking the
BoJ to set a medium-term inflation target.
The prospects of a weaker yen in the wake of aggressive
monetary easing in Japan pushed benchmark gold on the Tokyo
Commodity Exchange to a record high on Friday, and
fuelled hopes for fresh interest in bullion from Japanese
investors, who have been avid gold sellers during the metal's
bull run in the past few years.
Japan's markets were closed on Monday for a public holiday.
Platinum and palladium extended gains from the last session,
tracking higher risk appetite in the market. Spot platinum
rose 0.3 percent to $1,633, on course for a fifth day of
gains, matching a similar run in November.
Platinum was close to reach parity with gold as its discount
stood at the narrowest in nine months, after platinum's
three-week winning streak.
Spot palladium inched down 0.1 percent to $696,
snapping a four-day rise, and is vulnerable to further decline
after build-up of massive net long positions.
Net longs in U.S. palladium futures and options dropped from
a record high of 18,379 lots to a one-month low of 15,233 lots
in the week ended Jan. 8, still more than double the volume in
"Any market that gets a buildup like that is likely to see
people move towards the sidelines because it may see a nasty
correction," said a Hong Kong-based trader.
Precious metals prices 0756 GMT
Metal Last Change Pct chg YTD pct chg Volume
Spot Gold 1668.50 6.06 +0.36 -0.36
Spot Silver 30.71 0.28 +0.92 1.42
Spot Platinum 1633.00 4.25 +0.26 6.38
Spot Palladium 696.00 -1.00 -0.14 0.58
COMEX GOLD FEB3 1668.30 7.70 +0.46 -0.45 16495
COMEX SILVER MAR3 30.73 0.32 +1.06 1.65 4465
COMEX gold and silver contracts show the most active months
(Editing by Clarence Fernandez and Muralikumar Anantharaman)