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Asian gold higher in afternoon in quiet trade

HONG KONG: Asian spot gold rose on Monday in quiet trading after buying from Australia and Europe and was likely to take direction from stocks' performance.

Gold bullion was quoted at US$280.40/90 per ounce late on Monday compared to New York's previous close at US$279.70/280.70 on Friday.

The gold price rose as Australian buying pushed it up to US$280.60/281.10, followed by Japanese and other selling, which pushed it lower again. Later the price recovered on more buying for physical demand from Europe, traders said.

Gold was seen trading in a US$278 to US$283 range in the short term. The gold market would focus on movements in sometimes volatile equities markets, which sparked a brief rally last week as worried investors switched to bullion, traders said.

But gold has little chance to rise above US$300 an ounce, a leading US economist said on Monday.

David Hale, senior global economist for the Zurich Group, said even though demand for gold was rising steadily, the huge expansion in the leasing market was holding back the price.

Speaking in Perth, Australia, Hale said the strong growth projections for gold demand in India and Southeast Asia may be insufficient to counter the negative impact of forward sales by producers.

In Tokyo gold futures ended higher as the yen's fall against the dollar spurred short-covering, a trader said.

Spot silver was quoted at US$5.08/11 an ounce, unchanged from the closing price in New York on Friday.

Local tael gold was quoted HK$5 up at HK$2,604.

The carry over charge at the Chinese Gold and Silver Exchange Society was -3, up from its previous fix at -4.-Reuters