960412

London gold

touch easier

after US data

LONDON: Gold eased back slightly following mixed U.S. price data on Friday, reflecting some disappointment and a pick-up in the bond market, dealers said. The Comex options expiry was forecast to be "a damp squib", a dealer said.

Bullion fixed at $394.75 per ounce, compared with $395.20 Friday morning. Comex most-active June was at $397.20, down $1.10, at the fix.

The U.S. figures were mixed, with the CPI index up 0.4 percent compared to an expected 0.3 percent, and retail sales up 0.1 percent rather than the expected 0.3 percent.

"The U.S. figures didn't give us anything positive to go on. Everyone was hoping we'd come out with inflationary numbers again. But the bond market rallied on those figures," a dealer said.

Dealers saw gold keeping in a tight range of $394 to $396, with a possible foray up to $397. Bids were quoted so far from $395.65 to $394.30. "There's not a lot happening at the moment, the market looks a bit weak," a dealer said.

One dealer noted some producer selling but said physical demand was very good. "The market isn't going to rally an awful lot until that selling is out of the way," he said.

The Comex option expiry due later on Friday generated little excitement among dealers. Calls of $5.75 and $6.00 for silver were active, but unlikely to be exercised, they said.

"The bids for $5.75 are not really going, and $5.50 looks more realistic. The market looks to me like it will sell off, perhaps to $5.48," one dealer said.

But one dealer said the market was ready for anything, unlike last Easter when out-of-the-money calls were exercised after the European markets were closed for the holiday weekend.

"Anyway the expiry doesn't coincide with Easter this time," the trader said.

Silver, seen trading within a range between $5.55 and $5.48, eased gently along with gold, with bids quoted from $5.55 to $5.50 per ounce.

Platinum was about $5.00 weaker from London's Thursday close, with support pegged at $405 and then $400.

Bids were recorded so far from $409.50 to $404.75.

Palladium was little changed after Thursday's dip below support. Bids were quoted so far from $138 to $136.-Reuter