Gold retreated in Asia on Friday, hurt by a strong US dollar and waning inflationary fears in the United States. Gold was under the spell of currency markets, dealers said, with the rising US dollar a sell signal for bullion. Prices have declined 3 percent since hitting an 18-year peak of $480.25 in mid-October.
Falling oil prices, which eased concerns on inflation, also took the polish off gold across Asia. "There are a few bearish signals in the market right now," a dealer said.
The dollar rose a two-year high against the euro and oil prices fell more than $1 to a near four-month low. Dealers said gold was maintaining technical support above $460 an ounce, which should limit further losses heading into more active trade in Europe.
Bullion found little support from news of a halt to operations at the one million ounces-a-year Porgera gold mine in Papua New Guinea, given surplus supplies of the metal.
The Progress mine, one of the largest in the Southern Hemisphere, has been idle since on Sunday when vandals brought down an electricity pylon which cannot be replaced until local weather improves.
"We're just waiting for the weather to clear, then we should be back up to normal," said a spokesman for the majority owner, Canada's Placer Dome Inc. But with the world's official government holdings of gold topping 32,000 tonnes enough to satisfy world demand for at least a decade supply interruptions carried little weight, dealers said.
Spot gold was quoted at $465.50/$466.10 versus $466.50 in late New York and a late London fix of $467. Spot platinum also eased, dipping to $956/960 an ounce from $959/962 an ounce in New York.
The retreat follows a strong showing in the last New York Mercantile Exchange futures market, where platinum settled at a new 26-year high, while palladium hit a 17-month peak.
Spot palladium was steady at $239/$243 an ounce in Asian trade. Spot silver rose 2 cents to $7.70/72 in Asia.
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