US MIDDAY: gold flat

Gold prices were flat early on Thursday after US Federal Reserve Chair Yellen failed to provide clarity on the impact of a harsh winter on recent economic weakness, while political uncertainty over Ukraine provided some safe-haven demand. Platinum and palladium each climbed more than 1 percent after South Africa's Impala Platinum declared force majeure on supply contracts at its strike-hit Rustenburg mine, intensifying supply fears from the top exporter of the metals by far.
In her testimony to the US Senate Banking Committee, Yellen said the Fed would be on alert to make sure recent signs of weakness in the US economy were due to cold weather and storms rather than a fundamental slowdown. Analysts, however, said overall improvement in the US economy and a strong dollar could weigh down on gold in the longer run.
"There are still concerns that weakness in the US economy is still going to spill over into March because of the cold weather that we have seen throughout February," Deutsche Bank analyst Michael Lewis said. "My sense is that gold may still have a bit more upside to run, but we still have that strong dollar, strong US growth view, which will weigh the metal down in the longer term," he said.
Spot gold edged down 39 cents to $1,330.31 an ounce by 1:39 pm EST (1839 GMT), well off a high of $1,345.35 hit earlier in the session. US COMEX gold futures for April delivery were up $2.70 an ounce at $1,330.70, with volume on track to finish in line with its 30-day average, preliminary Reuters data showed.
A weaker dollar underpinned gold buying, traders said. Earlier, the US currency rose to a two-week high against a basket of major currencies as a stronger-than-expected read on US durable goods orders offset a rise in weekly jobless claims. Platinum group metals rose about 1.5 percent after Impala's decision to declare force majeure on supply contracts, which allows certain terms of an otherwise legally binding agreement to be ignored. Platinum rose 1.3 percent to $1,445.24 an ounce, while palladium gained 1.5 percent to $739.75 an ounce. Silver was up 0.1 percent at $21.24 an ounce, recovering from Wednesday's nearly 3 percent drop.