NY gold falls below $440 as dollar rebounds vs euro


NEW YORK, March 17 (Reuters) - Gold futures tumbled Thursday morning, slipping below this week's range of $440 to $445 an ounce, as the dollar rebounded against the euro.

The greenback's recovery against the euro hit metals across the board, with players positioning before an expected hike in U.S. interest rates next week, analysts said.

Platinum fell from a contract high set overnight on talk of tighter availability of South African metal.

Gold for April delivery at the COMEX division of the New York Mercantile Exchange was down $5.20 at $439 an ounce by 10:30 a.m. EST (1530 GMT), trading from $444.50 to $437.70 which marked its lowest price since March 8.

"The dollar is doing a bit better and there hasn't been a lot of fund interest in gold -- you've had dealer and bank selling and the funds were not going after it (buying)," said Refco analyst Tom Boustead.

"Gold seems to be stuck below resistance at $445 and they are liquidating now. I think there must be some general fear that the dollar may correct a bit," he added.

The U.S. Federal Reserve is widely expected to lift rates by a quarter percent to 2.75 percent on Tuesday. Rate hikes tend to prop up the dollar and, ultimately, weigh on gold.

Markets mainly are interested in the Fed's statement accompanying the decision on rates next week, Boustead said, which could give a clearer signal as to the central bank's approach to monetary policy for later in the year.

The greenback rose 0.5 percent against the euro to $1.3352 by midmorning.

A stronger U.S. currency tends to depress gold as the dollar-denominated metal becomes pricier for non-U.S. buyers.

Gold also failed to draw much support from U.S. crude oil prices scaling new highs above $57 a barrel on Thursday. Oil's jump forced OPEC to consider a second output increase just a day after its deal to raise supplies failed to cap prices.

Gold sometimes climbs when oil surges because investors have historically turned to the metal as an inflation hedge.

Meanwhile, U.S. jobless claims fell 10,000 to 318,000 in the latest week, close to forecasts for claims to drop to 315,000.

Brokers viewed first technical support in COMEX April gold at $438 and then at $435, with resistance at $445 and $449.

April gold soared to a 16-1/2-year peak at $460.50 back on Dec. 2.

Spot gold was worth $437.95/8.70 from Wednesday's New York close at $443.30/444.00. Thursday's afternoon London fix was at $438.60.

"Further base building around the $440 level looks set to be seen over the coming sessions with the dollar still providing a great deal of the metals direction," said TheBullionDesk.com in a report.

It added that, below the $435 area, chart support in spot gold lurked at the 100-day moving average at $432.55.

In NYMEX trade, April platinum fell from a contract high at $889 an ounce to trade at $879 for a loss of $8.80 by midmorning. Spot platinum reached $876/880. The market rose above $900 in late January.

June palladium was down $3.80 at $202.75 an ounce. Spot palladium fetched $199/203.

May silver fell 7.2 cents to $7.38 an ounce, moving from $7.495 to $7.34. Spot silver touched $7.34/37 against $7.40/43 previously. It fixed at $7.36.



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