US MIDDAY: gold jumps

Gold futures rose 1 percent early on Tuesday, partially recovering the previous session's losses, as a sharply lower dollar increased bullion's demand as a hedge against the falling US currency. August up $9.90, 1.1 percent, at $937.40 an ounce at 9:08 am EDT (1308 GMT) on the COMEX division of the New York Mercantile Exchange. Ranged from $927.70 to $940.60.
Gold boosted as the dollar extended losses against the euro on the back of better-than-expected US housing starts data in May, prompting investors to sell the greenback and buy other riskier investments, said traders. August futures largely shook off a lower-than-expected US producer price index in May, but longer-term inflation potential provided background support to gold, said traders.
However, any potential currency diversification news from the BRIC (Brasil, Russia, India and China) summit in Moscow would be far from a significant estrangement to the dollar, said Jon Nadler, senior analyst at Kitco Bullion Dealers. Gold's upward potential is limited because of strong demand for the US dollar to repay a burgeoning debt amid deflation, said technical analyst Robert Prechter.
In mining news, protesters have shut access to Buenaventura's Orcopampa gold mine in Peru and its production is affected, according to a company. COMEX estimated 9 am volume at 34,148 lots. Gold/oil ratio falls to 12.94, against the 13.16 of the previous session, as oil prices outperformed gold on Tuesday. Spot gold traded at $936.40, up 0.9 percent from its previous session. London gold fix at $936.75 an ounce.
July silver up 26.50 cents, or 1.9 percent, at $14.295 an ounce, rebounding from a nearly 6 percent tumble in the previous session. Ranged from $14.050 to $14.405. COMEX estimated 9 am volume at 7,784 lots. Spot silver was at $14.29 an ounce, up 1.7 percent from its previous finish. London silver fix at $14.30 an ounce.
July platinum up $17.30, or 1.4 percent, at $1,231 an ounce, as a sharply weaker dollar boosted precious metals across the board. Spot platinum at $1,224.50 an ounce, up 1.7 percent from its previous session. September palladium edged up $1 to $247.00 an ounce, tracking platinum's gains. Spot palladium was at $244 an ounce, up 1.5 percent from its previous finish. Prices at 9:08 am EDT (1308 GMT).