November 16, 2018 / 5:05 PM / a month ago

PRECIOUS-Gold jumps as dollar slides; palladium hits record high

    * Gold on track for biggest weekly gain in five
    * Palladium set for biggest weekly gain since Sept. 21
    * GRAPHIC-2018 asset returns: tmsnrt.rs/2jvdmXl

 (Updates prices)
    By Swati Verma and Karthika Suresh Namboothiri
    BENGALURU, Nov 16 (Reuters) - Gold rose as much as 1 percent
on Friday as the dollar fell after U.S. Federal Reserve
officials made cautions comments on the outlook for interest
rate hikes, while palladium hit a record high driven by worries
about short supplies.
    Spot gold        rose 0.7 percent to $1,221.60 an ounce by
13:52 p.m. EST (1852 GMT). The session high was the highest
since Nov. 8 at $1,225.29. Gold has gained over 1 percent so far
this week, its best in five weeks. 
    U.S. gold futures        settled up $8, or 0.7 percent, at
$1,223. 
    Two Fed officials cautioned that global economic growth was
slowing. The dollar fell to one-week lows against a basket of
major currencies       , making bullion cheaper for buyers in
other currencies.       
    "When you get people talking about the economy slowing down,
they may not raise rates so quickly or as aggressively and that
is bearish for the dollar," said INTL FCStone analyst Edward
Meir.
    Weaker global stock  markets and lower U.S. Treasury yields
gave another leg for gold.                  
    "A weaker dollar and lower yields are pretty much tailor
made to benefit gold," said James Steel, chief metals analyst at
HSBC Securities in New York, who sees prices rising to
$1,245-$1,250.
    Palladium        climbed 1.4 percent to $1,172.49 an ounce,
up more than 5 percent this week. The metal hit a record high of
$1,185.40 earlier in the session, within a whisker of parity
with gold for the first time in 16 years.             
    
    "The market is in a big deficit. There is a lot of fund
interest in palladium because the funds like to buy something
when its moving... But the supply is of concern now,"  INTL's
Meir said.
    Used mainly in emissions-reducing auto catalysts for
vehicles, palladium, the only precious metal on track for an
annual gain, was also helped by speculation Beijing may provide
a stimulus to Chinese auto markets.
    "In the medium to longer term, I do not think these price
levels are sustainable ... also assuming we do get some sort of
stimulus in China that pulls more and more demand into the
present and weighs on the future demand outlook for the Chinese
car market," said Julius Baer analyst Carsten Menke.
    Car dealers in the world's biggest car market have been
pushing for Beijing to support the sector.             
    Silver        rose 0.7 percent to $14.38 an ounce, on course
for a weekly gain of over 1 percent. 
    Platinum        was up 0.5 percent at $844.90, but was down
slightly for the week.

    
 (Reporting by Nallur Sethuraman, Swati Verma and Karthika
Suresh Namboothiri in Bengaluru
Editing by David Gregorio and Tom Brown)
  
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