PRECIOUS-Gold rises, ending four-day slide; FOMC eyed

* COMEX open interest down 4 pct, short-covering seen
* Market awaits Friday's U.S. non-farm payrolls data
* Palladium eyes $750/oz, highest in 16 months
* Coming up: US Fed Open Market Committee statement Wed.

(New throughout, changes byline, dateline, previously LONDON)
By Frank Tang
NEW YORK, Jan 29 (Reuters) - Gold rose on Tuesday, snapping
a four-day losing streak, lifted by short-covering and expected
continuation of loose U.S. monetary policies.
Platinum and palladium also rebounded after Tuesday's drop
as supply worries and hopes for demand recovery triggered strong
fund interest.
Bullion climbed a day before a Federal Reserve policy
statement in which the U.S. central bank is expected to keep
short-term interest rates exceptionally low until the U.S.
unemployment rate falls to 6.5 percent, inflation permitting.

"What's going to come out of the Fed is more of the same, so
we can just anticipate that (quantitative easing) is here at
least for a little while longer," said Jeffrey Sica, chief
investment officer of SICA Wealth, who oversees more than $1
billion in client assets.
Spot gold rose 0.5 percent to $1,662.04 an ounce by
1:55 p.m. EST (1855 GMT), recovering from Monday's 2-1/2 week
low of $1,651.93.
U.S. gold futures for February delivery were up $7.90
at $1,660.80 an ounce, with volume more than 40 percent above
the 250-day average due to the February-April rollover ahead of
February's first-notice day Friday.
Open interest in COMEX futures dropped 4 percent on Monday
after four consecutive days of price decline, CME data showed,
suggesting some investors were buying back their bearish bets
after the sharp pullback, traders said.
A drop in the dollar index and U.S. equities' gain
also boosted gold.
Loose U.S. monetary policy helped drive gold to a 12th year
of gains in 2012.
There has been growing discomfort among U.S. policymakers
about the Fed's bond buying, or quantitative easing (QE),
currently running at $85 billion a month, although analysts do
not expect any imminent change in Fed policy.
U.S. non-farm payrolls data on Friday will also be examined
for clues on the state of the world's largest economy.

DEMAND STRONG INDIA SILVER
Spot silver was up 1.5 percent to $31.28 an ounce
after touching a two-week low of $30.71 in the previous session.
Silver mirrored gold's rise, and was also underpinned by
reports that India's silver exports are expected to rise by up
to 30 percent this year.
Among platinum group metals, platinum rebounded from
a nearly 2 percent fall on Monday, its sharpest daily decline in
more than a month. It was last up 0.9 percent at $1,674.49 an
ounce.
Losses in the previous session followed news that Anglo
American Platinum and labor unions in South Africa
agreed to postpone a restructuring involving 14,000 job cuts to
allow for more talks.
Spot palladium rallied 1.4 percent to $746.22 an
ounce, having earlier hit a fresh 16-month high of $748.50.
Market talk about dwindling sales from Russia's state-owned
palladium stockpile and booming auto demand have spurred heavy
buying by hedge funds and momentum traders, analysts said.
1:55 PM EST LAST/ NET PCT LOW HIGH CURRENT
SETTLE CHNG CHNG VOL
US Gold FEB 1660.80 7.90 0.5 1653.50 1665.00 132,112
US Silver MAR 31.184 0.404 1.3 30.850 31.355 27,860
US Plat APR 1678.90 16.70 1.0 1662.70 1682.80 8,740
US Pall MAR 749.75 9.20 1.2 734.30 750.90 4,916

Gold 1662.04 7.70 0.5 1655.05 1665.66
Silver 31.280 0.460 1.5 30.870 31.320
Platinum 1674.49 15.50 0.9 1665.00 1676.00
Palladium 746.22 10.50 1.4 736.52 748.50

TOTAL MARKET VOLUME 30-D ATM VOLATILITY
CURRENT 30D AVG 250D AVG CURRENT CHG
US Gold 250,493 156,919 174,507 13.42 -0.73
US Silver 29,528 42,609 53,449 21.81 1.64
US Platinum 8,991 15,366 10,880 16.45 -0.01
US Palladium 5,142 3,381 4,805

(Additional reporting by Clare Denina in London and Rujun Shen
in Sigapore; editing by John Wallace)