August 28, 2012 / 3:50 AM / 7 years ago

PRECIOUS-Gold inches down as investors await central banks meeting

* Indonesia scrap sales surge as Eid al-Fitr ends
    * Silver, platinum still overbought
    * Spot gold may fall to $1,643/oz - technicals
    * Coming up: U.S. consumer confidence, Aug; 1400 GMT

    By Rujun Shen
    SINGAPORE, Aug 28 (Reuters) - Gold edged lower on Tuesday
after rising to its highest in over four months in the previous
session, as caution prevailed ahead of a central bankers'
meeting this week.
    Spot gold surged on Monday after U.S. Federal Reserve
Chairman Ben Bernanke, in a report to a congressional panel,
said the central bank sees room to further ease its monetary
policy, raising hopes for another round of quantitative easing,
or QE3.
    Central bankers and finance ministers from around the world
are scheduled to meet at Jackson Hole, Wyoming on August 31 and
September 1, and investors expect speeches by Bernanke and
European Central Bank chief Mario Draghi to shed light on
possible measures to shore up their sluggish economies.
    "If we get QE3, gold could rise to $1,680 or $1,700," said
Peter Fung, head of dealing at Wing Fung Precious Metals in Hong
Kong. "But for now, it is still unclear what is going to happen,
 though hopes for QE are keeping gold supported at the $1,650
    Spot gold edged down 0.2 percent to $1,660.10 an
ounce by 0627 GMT, after rising to $1,676.45 on Monday, its
highest level since mid-April.
    U.S. gold fell 0.8 percent to $1,662.70.
    Technical analysis suggested spot gold may drop to $1,643
during the day, said Reuters market analyst Wang Tao.
    Scrap selling in Asia's physical gold market continued as
Indonesia returns from the Eid al-Fitr celebrations marking the
end of the fasting month and cashes out after gold surged more
than 3 percent last week and broke above a $100 range that it
had held since May.
    "A lot of scrap is flooding the market," said a
Singapore-based dealer. "Last week it was the Thais that sold
scrap and this week is the Indonesians."
    The euro eased against the dollar, extending losses for the
third day straight, putting pressure on bullion. 
    Spot platinum traded around $1,530 an ounce, off a
3-1/2-month high of $1,558.49 hit last week, despite the
festering labour strife in South Africa's platinum mines. 
    The Relative Strength Index on spot platinum and silver
remained above 70, suggesting the underlying assets are
    Spot silver lost 0.2 percent to $30.62 an ounce,
easing from $31.26 hit on Monday, its highest level in nearly
four months.
    "Technical signals still look good on silver after we broke
above the 200-day moving average," said a Shanghai-based trader,
"But in the absence of improving industrial demand, the monetary
policy will decide where prices will go."
    The 200-day moving average stood at $30.30.
    "If we are able to hold onto the 200-day moving average, the
chart will look very nice and attract more buying interest," the
trader added.
    Total holdings of silver-backed exchange-traded funds fell
0.6 percent to 501.198 million ounces by Aug. 27, but still
gained 1 percent so far this month. 
 Precious metals prices 0627 GMT
  Metal             Last    Change  Pct chg  YTD pct chg    Volume
  Spot Gold        1660.10   -3.50   -0.21      6.16
  Spot Silver        30.62   -0.07   -0.23     10.58
  Spot Platinum    1528.99   -8.11   -0.53      9.76
  Spot Palladium    641.10   -4.50   -0.70     -1.75
  COMEX GOLD DEC2  1662.70  -12.90   -0.77      6.12        16616
  COMEX SILVER SEP2  30.63   -0.42   -1.36      9.71         6888
  Euro/Dollar       1.2484
  Dollar/Yen         78.54
  COMEX gold and silver contracts show the most active months
0 : 0
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