* Bullion investors await BoE, ECB meetings on Thursday
* Platinum, palladium jump on fund buying, auto-sector boon
* Gold's premium over platinum shrinks to four-month low
* Coming up: US weekly jobless claims, wholesale data Thurs
(Adds market details, updates prices)
By Frank Tang
NEW YORK, Jan 9 Gold eased in light trading on
Wednesday, giving back some of the previous session's gains,
while platinum group metals rallied as improving U.S. auto sales
and a better economic outlook triggered fund buying.
Bullion retreated after Tuesday's almost 1 percent gain,
lifted by speculation the Bank of Japan will consider easing
monetary policy again in January. Signs of better Asian physical
demand from China and India, however, provide underlying
support, traders said.
Market sentiment remains cautious after minutes from the
December meeting of the Federal Open Market Committee showed
several top officials favored slowing or stopping the stimulus
program "well before" the end of the year.
"The gold market now focuses on the ECB meeting tomorrow and
the FOMC meeting at the end of the month. Other than those, gold
has struggled to find a direction in a slow news week," said
David Meger, director of metals trading at Vision Financial
The metal market will now closely monitor remarks from
Thursday's meetings of both the Bank of England and the European
Central Bank for any hint about the central banks' monetary
policies. A string of U.S. economic data next week including
retail sales, consumer prices and housing starts could offer new
catalyst for the gold market, analysts said.
Spot gold was down 0.1 percent at $1,656.20 an ounce
by 3:02 p.m. EST (2002 GMT).
U.S. COMEX gold futures for February delivery settled
down $6.70 at $1,655.50, with trading volume at around 20
percent below its 30-day average, preliminary Reuters data
Technical selling also weighed down on gold after the metal
ran into resistance after it has failed to hold gains above its
200-day moving average at around $1,660 in recent sessions,
In the physical market, gold buying tailed off in major
consumer India after a strong start to the week as dealers
awaited a further price correction, traders said.
Holdings of the world's largest gold-backed exchange-traded
fund, New York's SPDR Gold Trust, eased for a second day
and are down 11 tonnes from the start of the year.
ECONOMIC OPTIMISM BOOSTS PALLADIUM
Palladium rose 2.4 percent to $684 an ounce for its
biggest one-day gain in around two weeks. However, palladium was
still down 0.3 percent for week after it lost almost 3 percent
Small gains in U.S. equities amid a brighter economic
outlook and signs of continuous improvement in U.S. auto sales
prompted funds to pour into palladium, Vision's Meger said.
Among other precious metals, silver was down 0.3
percent to $30.27 an ounce, while platinum gained 1.3
percent to $1,594.50 an ounce.
Gold's premium over platinum, a historically unusual
phenomenon that has persisted since the first quarter of last
year, fell to $60, its lowest at around since mid-September on
3:02 PM EST LAST/ NET PCT LOW HIGH CURRENT
SETTLE CHNG CHNG VOL
US Gold FEB 1655.50 -6.70 -0.4 1651.30 1666.00 118,484
US Silver MAR 30.249 -0.216 -0.7 30.065 30.575 31,730
US Plat JAN 1597.80 17.20 1.1 1576.40 1601.40 208
US Pall MAR 688.20 20.35 3.0 673.10 693.50 4,614
Gold 1656.20 -2.40 -0.1 1652.00 1665.80
Silver 30.270 -0.080 -0.3 30.080 30.560
Platinum 1594.50 20.80 1.3 1579.50 1599.00
Palladium 684.00 15.90 2.4 674.20 690.00
TOTAL MARKET VOLUME 30-D ATM VOLATILITY
CURRENT 30D AVG 250D AVG CURRENT CHG
US Gold 139,957 158,079 174,192 13.35 -0.07
US Silver 36,902 48,280 53,114 22.4 -1.38
US Platinum 15,016 14,016 10,480 16.79 -0.19
US Palladium 4,657 4,575 4,802
(Additonal reporting by Jan Harvey and Veronica Brown in
London; Editing by Marguerita Choy)