Gold rose in Asia on Thursday after the euro rebounded from an 8-month low against the dollar, while platinum hit a 3-week high on fund buying in Japan before profit-taking erased some of the gains. Spot gold was trading at $416.10/416.60 an ounce, against $415.65/416.15 last quoted in New York on Wednesday. It touched a high of $417.55 an ounce in Asia. Some dealers said the gains were mainly driven by currency movements and not by fresh demand from jewellery makers and investors.
Premiums for gold bars were unchanged at 40-50 US cents an ounce to London spot price in Singapore. Premiums in Hong Kong were also unchanged at 30-40 US cents an ounce.
"If the price did get down to below $410, then we'd see physical demand come back in," said one dealer in Singapore, referring to levels last seen in September 2004.
Platinum rose to a 3-week high at $874 an ounce before easing to $871/876. That was higher than $868/871 last quoted in the US market. The metal was supported by gains in Tokyo futures, where fund buying pushed up platinum contracts after benchmark April breached a key resistance level this week.
Some dealers said there was no sign of fresh demand from jewellers or automakers. "I guess this is purely a technically-driven market. I don't see any physical demand at the current level," said one dealer in Tokyo.
Platinum is used in jewellery and as auto catalyst to clean exhaust fumes. Sister metal palladium was little changed from New York's levels at $182/187 an ounce.
In the currency market, the euro was trading at $1.2202, versus $1.2180 late in New York where it fell as low as $1.2158 its lowest since mid-September.
The euro had fallen after Dutch voters rejected a new European Union constitution, which followed a resounding "No' vote by France. The double rejection has raised doubts about the prospects for economic reform in the euro zone.
"Despite the sharp rise in the US dollar, gold has fared well, remaining in a narrow $415-$417 band," said N M Rothschild in a daily report.
"However, given the recent strength in the US dollar, it may be only a matter of time before gold succumbs to selling pressure and retest this year's low around $412," it said.
Silver was calmer after rising to $7.58 an ounce on Wednesday, its highest level since March 10, due to fund buying. The metal has been supported by talk of an imminent new trading vehicle to lure investment.
Some dealers said silver was technically healthy and could rebound in London and New York markets. "But I still think there will be resistance around the high $7.50s.
To break through $7.60, I think it will be quite tough," said the dealer in Singapore. Spot silver was quoted at $7.45/7.47 an ounce, down from $7.49/7.52 last quoted in New York.
On Hong Kong's Chinese Gold and Silver Exchange, gold was quoted at HK$3,866 per teal (37.5 gram ingot), up from HK$3,860.
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