PRECIOUS-Gold eases on Wall St rally, bright US trade data

Sat Feb 9, 2013 2:58am IST

* US trade gap narrows in 4th-qtr, seen positive
    * Gold ends week almost flat
    * Platinum investors take profits after spec rally
    * Coming up: U.S. Jan. federal budget Tuesday

 (New updates throughout, changes byline, dateline, previously
LONDON)
    By Frank Tang
    NEW YORK, Feb 8 (Reuters) - Gold fell on Friday as gains in
U.S. equities and economic optimism after encouraging
international trade data prompted bullion investors to reduce
their bullish bets.
    Bullion fell after U.S. data showed the economy likely
expanded slightly in the fourth quarter as higher exports and a
slump in oil imports narrowed the trade gap, suggesting a
surprise drop in economic output reported last week was
overstated. 
    The metal was also pressured by overnight Chinese export and
import figures, which pointed to robust domestic demand and a
pickup in the economy. Signs of a heated Chinese economy could
force the country's central bank to tighten its monetary
policy. 
    Gold was nearly unchanged for the week, while U.S. equities,
as measured by the S&P, were up 0.3 percent after better U.S.
manufacturing data earlier this week. 
    Renewed economic fears over the euro zone and the Bank of
Japan's recent effort to weaken the yen, however, could boost
gold buying, traders said.
    "The biggest factor to watch out for gold is the possible
economic degradation of Europe and Japan. Gold may once again
benefit as safe haven because of worries of currency
devaluation," said Zachary Oxman, managing director of brokerage
TrendMax.    
    Spot gold was down 0.2 percent at $1,668.11 by 3:36
p.m. EST (2036 GMT).
    U.S. gold futures for April delivery settled down
$4.40 at $1,666.90 an ounce, with trading volume almost 50
percent below its 250-day average, preliminary data showed.
    Gold inched up less than 0.1 percent for the week after its
Thursday drop as European Central Bank President Mario Draghi
said that economic activity in the euro area should gradually
recover later in 2013 but there are more negative risks than
positive ones. 
    Spot silver fell 0.1 percent to $31.42 an ounce.
   
    ETF HOLDINGS UP
    Resilient physical demand, which lifted gold prices in early
January, could underpin precious metals in the near term.
    SPDR Gold Trust, the largest gold-backed
exchange-traded fund (ETF), saw its first inflow since
mid-January in the previous session, rising a modest 1.8 tonnes.
However, its holdings are down nearly 21 tonnes this year. 
    Holdings in the iShares Silver Trust were up 25.6
tonnes on Thursday, bringing its total inflow for the week to
67.86 tonnes. So far this year, its holdings were up 361.42
tonnes.
    Platinum fell after rallying earlier this week to its
highest price in more than a year and a half, as speculative
investors started to take profits. 
    Spot platinum fell 0.1 percent to $1,713.24 an ounce,
after rising as high as $1,740 earlier this week. 
    Palladium was up 0.4 percent at $751.22. It touched
its highest since September 2011 at $769.50 an ounce on
Wednesday. 
    Analysts said fundamentals appear strong for platinum group
metals, used in auto catalysts and jewelry, due to a more
positive economic outlook, mining disruptions in South Africa
and a drop in palladium output from Russia. 

 3:36 PM EST     LAST/    NET   PCT      LOW    HIGH  CURRENT
                SETTLE   CHNG  CHNG                       VOL
 US Gold APR   1666.90  -4.40  -0.3  1665.80 1674.30   88,726
 US Silver MAR  31.441  0.038   0.1   31.330  31.695   34,173
 US Plat APR   1714.70  -7.60  -0.4  1707.50 1734.00   11,222
 US Pall MAR    751.50   1.05   0.1   740.25  758.45    5,568
                                                              
 Gold          1668.11  -2.58  -0.2  1665.75 1673.30         
 Silver         31.420 -0.020  -0.1   31.360  31.670
 Platinum      1713.24  -2.50  -0.1  1709.50 1728.74
 Palladium      751.22   3.25   0.4   743.75  756.50
                                                              
 TOTAL MARKET              VOLUME          30-D ATM VOLATILITY
                CURRENT   30D AVG  250D AVG   CURRENT     CHG
 US Gold         95,511   180,140   172,544     13.42   -0.21
 US Silver       43,544    45,814    51,737     20.67    0.24
 US Platinum     11,448    17,478    11,053     17.21    0.00
 US Palladium     6,399     4,640     4,742                  
                                                              
 

 (Additional reporting by Clara Denina in London; editing by Jim
Marshall)
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