PRECIOUS-Gold at 6-month high as Fed fans inflation risk

* Precious metals hit multi-month highs
* Spot palladium headed for 11th day of gains
* Spot gold may rise to $1,785-$1,796 range - technicals
* Coming up: U.S. retail sales, Aug; 1230 GMT

(Adds details, comments; updates prices)
By Rujun Shen
SINGAPORE, Sept 14 (Reuters) - Gold rose to a six-month high
on Friday, extending the previous session's 2-percent gain,
after the Federal Reserve launched an aggressive economic
stimulus program that could add to the risk of inflation and
strengthen bullion's appeal.
Silver, platinum and palladium, widely used in industrial
application, also climbed to their highest in about six months,
as the appetite for riskier assets rose after the Fed announced
an open-ended debt buying programme and pledged to keep interest
rates near zero until at least mid-2015.
Cash gold is on course for a 2.3-percent gain this week -- a
fourth week of consecutive rises, as investors have been
encouraged by central banks' latest push to promote global
growth by printing more cash.
"The Fed's move will flood the market with liquidity, which
will consequently push up inflation and drive investors to
assets known to be good hedges, such as gold and silver," said
Li Ning, an analyst at Shanghai CIFCO Futures.
"At least in the short- to medium-term, the Fed's action
will provide solid support for gold and help it test $1,800, or
even $1,900."
Spot gold climbed as high as $1,777.51 an ounce, its
highest since Feb. 29, before giving up some gains to trade at
$1,774.60 by 0631 GMT, up half a percent from Thursday's close.
The most-active U.S. gold futures contract also hit
a six-month high, at $1,780.2, before edging back to $1,777.
Technical analysis echoed the bullish sentiment in the
market. Spot gold could rise to $1,785-$1,796 range during the
day, said Reuters market analyst Wang Tao.
Holdings of SPDR Gold Trust, the world's biggest
gold-backed exchange-traded fund, inched up 0.2 percent on the
day to 1,292.432 tonnes by Sept. 13.
The dollar index dropped to a four-month low, helping
attract gold buyers holding other currencies.

SILVER, PLATINUM, PALLADIUM HIT MULTI-MONTH HIGHS
Silver rallied to a six-month high of $34.92 an ounce
earlier, before easing to $34.72. It was headed for a more than
3 percent weekly rise, extending its winning streak to a fourth
week.
"Silver is poised to test the next resistance level at
$35.4," said a Shanghai-based trader. "The sentiment remains
bullish, as many investors are just entering the market after
confirmation of the QE3 overnight."
The recent rally, which has lifted silver by about 25
percent over the past month, is suppressing short-term physical
demand, he added.
Shanghai silver rallied more than 5 percent to
above 7,300 yuan per kg ($35.93 an ounce).
Spot platinum jumped more than 2 percent to a
six-month high of $1,713 an ounce, as concerns about supply
deepened with labour unrest in top producer South Africa's
mining sector. The metal is headed for a 8-percent rise on the
week, its biggest weekly gain since last October.
The gold-platinum spread narrowed to under $70 an ounce, a
level unseen since April, as platinum outperformed gold in
recent weeks.
Spot palladium struck a near six-month high of
$694.50, before paring some gains to $691.72. The metal was
poised for its 11th straight session of gains, its longest
winning streak since at least 1984.
"Palladium is playing catch-up with platinum, as the strikes
in South Africa is still going on, triggering worries about
supply of platinum group metals," said a Singapore-based trader.

Precious metals prices 0631 GMT
Metal Last Change Pct chg YTD pct chg Volume
Spot Gold 1774.60 8.31 +0.47 13.48
Spot Silver 34.72 0.08 +0.23 25.39
Spot Platinum 1702.74 26.04 +1.55 22.24
Spot Palladium 691.72 7.82 +1.14 6.01
COMEX GOLD DEC2 1777.00 4.90 +0.28 13.42 30336
COMEX SILVER DEC2 34.81 0.03 +0.09 24.70 9028
Euro/Dollar 1.3038
Dollar/Yen 77.55
COMEX gold and silver contracts show the most active months

(Editing by Himani Sarkar)
(rujun.shen@thomsonreuters.com; +65-6870-3726; Reuters
Messaging: rujun.shen.thomsonreuters.com@reuters.net)