* Eyes on minutes of Fed's June policy meeting
* Dollar's jobs-inspired rally runs out of steam
* Palladium hits 13-year peak at $873.75/oz
(Updates prices, adds Fed comment)
By Marcy Nicholson and Clara Denina
NEW YORK/LONDON, July 8 Palladium rose for the
12th straight session to its highest in more than 13 years on
Tuesday amid firm automotive demand and continued concerns
supplies in South Africa will tighten even after the end of a
Gold turned lower even as the dollar's recent rally faded
and investors awaited clearer signs from the U.S. Federal
Reserve that it is on track to raise U.S. interest rates next
In an otherwise quiet session, palladium hit $873.75
an ounce, the highest since February 2001, taking its gains to 8
percent over the past two weeks since miners in South Africa,
the world's second-largest producer, struck a wage deal to end a
five-month industrial action that crimped output.
Since then, other smaller strikes have broken out, stoking
The metal, mainly used in autocatalysts in automobile
manufacturing, has gained more than a quarter of its value since
early February, with gains aided by last week's data showing
U.S. auto sales at an eight-year high in June.
Later in the session on Tuesday, palladium pared gains and
was up 0.4 percent at $869.00 by 3:15 p.m. EDT (1915 GMT).
"We have supply concerns in South Africa and increasing
demand in China and U.S., the largest markets for
platinum/palladium demand," said Carlos Sanchez, director of
asset management for CPM Group in New York.
Gold prices turned lower after U.S. Fed policymaker Jeffrey
Lacker said he sees inflation firming this year. Minneapolis Fed
President Narayana Kocherlakota later warned that the labor
market has a long way to go until the U.S. central bank reaches
Spot gold fell 0.2 percent to $1,317.43 an ounce,
while U.S. gold futures for August delivery settled down
0.04 percent at $1,316.50 an ounce.
The market is awaiting the release of minutes from the Fed's
June policy meeting on Wednesday to gauge the central bank's
view on interest rates and economic strength.
The dollar eased against a basket of currencies, having
touched its highest in almost two weeks in the previous session.
Some traders said a lack of support from physical markets
could weigh on prices, however, tensions in the Middle East and
Ukraine are ensuring that there is still some demand for gold as
insurance against geopolitical risk.
Platinum fell 0.2 percent to $1,488.75 an ounce,
turning lower along with other precious metals and U.S. stock
Spot silver edged down 0.4 percent to $20.96 an
(Additional reporting by A. Ananthalakshmi in Singapore;
Editing by Marguerita Choy and Meredith Mazzilli)