March 30, 2011 / 6:23 AM / 9 years ago

PRECIOUS-Gold regains footing on equities, Libya; cenbanks eyed

 * Gold steadies, off intraday high
 * Coming Up: EZ Economic sentiment Mar 2011; 0900 GMT

 (Updates prices)	
 By Lewa Pardomuan	
 SINGAPORE, March 30 (Reuters) - Gold steadied on Wednesday
on firmer equities and upheaval in Libya, although further gains
could be capped by worries that some central banks will have to
soon start tightening monetary policy, a move that would dent
bullion's appeal as a hedge against inflation. 	
 In recent days, several top U.S. central bank officials have
said further bond purchases by the Federal Reserve were not
needed to support the economy, while European Central Bank
President Jean-Claude Trichet noted his inflation concerns from
rising food and energy prices. [ID:nFLATEE7LX]	
 But an uprising in the Arab world remained a key supporting
factor for gold, as a conference of 40 governments and
international bodies agreed to press on with a NATO-led aerial
bombardment of Libyan forces until Muammar Gaddafi complied with
a U.N. resolution to end violence against civilians. 	
 Spot gold added $4.25 an ounce to $1,420.20 an ounce
by 0556 GMT -- still well below a lifetime high around $1,447
struck last week. It had dropped 0.1 percent on Tuesday as the
talk of monetary tightening prompted selling. 	
 "You've got to ask yourself, how bad is inflation? I think,
really, you've got to get the economy moving before anything
happens," said Jonathan Barratt, managing director of Commodity
Broking Services in Melbourne.	
 "I think the market itself will probably get a little bit
headstrong if, in fact, we continue to get concerns in the
Middle East. I think gold is really being played out by what's
happening in the Middle East and risk aversion trade." 	
 Muammar Gaddafi's better armed and organised troops reversed
the rapid westward advance of rebels on Tuesday as world powers
meeting in London piled pressure on the Libyan leader to step
down. [ID:nLDE72S033]	
 In Syria, President Bashar al-Assad sought to deflect the
greatest challenge to his 11-year rule by mobilising tens of
thousands of Syrians in mass rallies across the country, while
in Yemen, protesters demanded an end to President Ali Abdullah
Saleh's rule. [ID:nLDE72T006][ID:nLDE72S111] [ID:nLDE72S033]	
  U.S. gold futures for April rose $4.1 to $1,420.3 an
 Japan's benchmark Nikkei average closed  up 2.64
percent at 9,708.79 on Wednesday, while the broader Topix
 gained 1.87 percent to 866.09.  	
 "There's a bit of physical buying but we've also seen some
selling on the upside. The Middle East is tense, but people also
think interest rates will go up in the euro zone, which is why
the market is capped," said a dealer in Hong Kong.	
 "It's a mixed market. We may see support at $1,410, while
the upside is capped at $1,420 and $1,422. We may trade within
this range for the rest of the week. Speculators don't seem to
know what to do." 	
 In Singapore, a centre for bullion trading in Southeast
Asia, dealers noted buying from Indonesia in an otherwise quiet
physical maret.	
  Holdings on the world's largest gold-backed exchange-traded
fund, SPDR Gold Trust , were unchanged at 1,211.836 tonnes.
 In currencies, the yen fell broadly on Wednesday, hitting
10-month lows against the euro and touching its lowest level in
nearly three weeks versus the dollar as interest rate
differentials widened in favour of U.S. and European currencies.
  The euro was down a quarter percent at $1.4078 while
the dollar index rose 0.1 percent against a basket of
major currencies, although it stayed well off last week's
15-month lows of 75.340.  	
  Gold demand to make jewellery, dental fillings and in
electronics will jump by more than 5 percent this year, the
biggest rise since 2000, metals research and consultant CPM
Group said on Tuesday. [ID:nN29295604]	
 Precious metals prices 0556 GMT
 Metal             Last    Change   Pct chg  YTD pct chg  Turnover
 Spot Gold        1420.20    4.25    +0.30      0.05
 Spot Silver        37.33    0.26    +0.70     20.97
 Spot Platinum    1752.49    18.04   +1.04     -0.85
 Spot Palladium    756.99     8.71   +1.16     -5.32
 TOCOM Gold       3793.00    55.00   +1.47      1.72         49581
 TOCOM Platinum   4704.00    98.00   +2.13      0.17         15775
 TOCOM Silver       99.40     2.50    +2.58     22.72         1837
 TOCOM Palladium  2030.00    74.00   +3.78     -3.20          240
 Euro/Dollar       1.4089
 Dollar/Yen         82.86
 TOCOM prices in yen per gram. Spot prices in  $ per ounce.
(Reporting by Lewa Pardomuan; Editing by Himani Sarkar)	
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