Gold was little changed within sight of its recent all-time highs on Thursday, recovering from an earlier drop on upbeat US labour data as investors remained unconvinced of the resilience of the world's largest economy. Gold has risen by some 15 percent in 2010 as economic uncertainty has unleashed a wave of investment in perceived safe-haven assets.
Spot gold was bid at $1,254.40 an ounce at 1437 GMT from $1,254.50 late in New York on Wednesday and less than 1 percent below June's record high at $1,264.90 an ounce. Earlier it fell to $1,250.30 an ounce.
US gold futures for December delivery were last down $1.5 at $1,256.00 an ounce. In Europe, equities rose and government bond prices fell on the back of the US data and on Ireland's decision to wind down lender Anglo Irish Bank in the coming weeks, which boosted investor risk appetite. "We are still in a situation where confidence ebbs and flows pretty rapidly from day to day, and sometimes from hour to hour, and morning to afternoon as the data comes in and changes people's opinions," said Credit Suisse analyst Tom Kendall.
"Sentiment is waning and rising; it's like a tide," a trader said. "I'm not sure where it's going to end. Guess we need to see a few more data points." Gold output has been dwindling in South Africa, which is expected to drop in the rankings to the world's fifth-largest producer this year from fourth in 2009, according to Reuters data. In other precious metals, silver was bid at $19.99 an ounce, against $19.88 on Wednesday when it hit its highest level since early 2008, as investors sought a cheaper safe-haven alternative to gold.
In the platinum group metals, traders kept an eye on developments at South African miner Northam Platinum, where union members are currently on strike and say action may continue for months. Platinum was last quoted at $1,558.00 an ounce, compared with $1,554.00 the day before, while palladium was at $525.50 compared with $522.00 on Wednesday.
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