Gold eases as greenback holds gains

SINGAPORE – Gold slipped on Friday in jittery trade as the US dollar held gains, while platinum dropped more than two per cent on persistent selling in Japan following this week’s report by top distributor Johnson Matthey.

Spot gold inched down to US$616,70/617,70 from US$618,00/619,00 in New York on Thursday, when the dollar gained after the US government said consumer prices fell by a greater-than-expected 0,5 per cent in October. “I reckon we may hit US$610 and trade below that.Resistance is going to be around US$630, and I think oil can become more an issue again should it break US$60,” said a dealer in Sydney.Gold fell nearly US$6 in the US market after the dollar reversed course and strengthened on the CPI data.It has lost around three per cent in value since rallying to a two-month high of US$636,50 last week.A rising US currency makes dollar-denominated gold more expensive for holders of other currencies.The US dollar was little changed from late New York trade around 118,28 yen, having risen as high as 118,35 yen on Thursday, near this month’s peak of 118,60 yen.Platinum fell more than two per cent and hit a low US$1,158 an ounce, led by selling in Japan, where the most active contract on the Tokyo Commodity Exchange, currently October 2007, fell to its lowest in nearly a week at 4,288 yen per gram.Johnson Matthey, the world’s biggest distributor of platinum, said in its Platinum 2006 Interim Review that supply and demand for the metal are likely to reach record levels in both 2006 and 2007, leaving the global market close to balance.Spot platinum was last quoted at US$1 188/1 192 in New York.”The price forecast disappointed people but the reality is quite different.I personally believe next year’s highest price is US$1 500,” he said.Johnson Matthey saw prices of platinum hovering between US$980 and US$1 200 an ounce in the next six months.Platinum jumped to a record high of US$1 336 an ounce in mid-May.South Africa, the world’s biggest producer of gold and platinum, slashed rates of proposed mining royalties in mid-October to lessen the impact of a controversial tax based on company revenues.The royalty rate on refined gold in the new draft bill was cut in half to 1,5 per cent and on refined platinum group metals reduced to three per cent from four per cent in the original bill released three years ago.Nampa-Reuters”I reckon we may hit US$610 and trade below that.Resistance is going to be around US$630, and I think oil can become more an issue again should it break US$60,” said a dealer in Sydney.Gold fell nearly US$6 in the US market after the dollar reversed course and strengthened on the CPI data.It has lost around three per cent in value since rallying to a two-month high of US$636,50 last week.A rising US currency makes dollar-denominated gold more expensive for holders of other currencies.The US dollar was little changed from late New York trade around 118,28 yen, having risen as high as 118,35 yen on Thursday, near this month’s peak of 118,60 yen.Platinum fell more than two per cent and hit a low US$1,158 an ounce, led by selling in Japan, where the most active contract on the Tokyo Commodity Exchange, currently October 2007, fell to its lowest in nearly a week at 4,288 yen per gram.Johnson Matthey, the world’s biggest distributor of platinum, said in its Platinum 2006 Interim Review that supply and demand for the metal are likely to reach record levels in both 2006 and 2007, leaving the global market close to balance.Spot platinum was last quoted at US$1 188/1 192 in New York.”The price forecast disappointed people but the reality is quite different.I personally believe next year’s highest price is US$1 500,” he said.Johnson Matthey saw prices of platinum hovering between US$980 and US$1 200 an ounce in the next six months.Platinum jumped to a record high of US$1 336 an ounce in mid-May. South Africa, the world’s biggest producer of gold and platinum, slashed rates of proposed mining royalties in mid-October to lessen the impact of a controversial tax based on company revenues.The royalty rate on refined gold in the new draft bill was cut in half to 1,5 per cent and on refined platinum group metals reduced to three per cent from four per cent in the original bill released three years ago.Nampa-Reuters