NEW YORK, Jan 28 (Reuters) - COMEX gold gained Wednesday morning as the euro rose on a soft U.S. durable goods report, with traders keeping vigil for a decision by Federal Reserve on interest rates this afternoon.
Gold for February delivery was up $1.10 to $411.20 an ounce at 10:05 a.m. EST, trading from $408.20 to $413.00.
"The market is fairly steady. The main feature is still the dollar fading and movements in dollar/euro," said James Pogoda, vice president of precious metals at Mitsubishi International Corp.
The U.S. Commerce Department said new durable goods orders in December were flat after November's revised 2.3 percent fall, in a weaker-than-expected report raising questions about the strength of the manufacturing recovery. Analysts had expected a solid rise of 2.0 percent.
"The euro is a little higher than when the number came out," Pogoda said. "The next focus is going to be on the FOMC statement."
Wall Street widely expects the Fed to reiterate its view that it does not plan to boost rates "for a considerable period." Its policy-setting arm wraps up its two-day meeting with a statement due at 2:15 p.m. EST.
Overnight news that Japan plans to carefully consider whether to change the weighting of gold in its foreign reserves hardly affected gold trading, analysts and traders said.
Japanese Finance Minister Sadakazu Tanigaki noted that he would be considering gold after he told a parliamentary committee he thought it necessary to take a stand on diversifying Japan's foreign reserve assets, which are mostly dollar-denominated.
HSBC analyst Alan Williamson said Japan's end-December gold reserves amounted to just 765 tonnes, of 1.5 percent of its total reserve base, the lowest of any industrialized country except Canada.
In currency news, German Economy Minister Wolfgang Clement said the European Central Bank need not at present use a rate cut or intervention to weaken the euro, but urged the United States to address the dollar's weakness.
A soft dollar often promotes buying in dollar-denominated metal such as gold as it becomes cheaper overseas.
The euro was at $1.2594 , versus an earlier high of $1.2662 and Tuesday's late quote at $1.2652.
In COMEX gold, traders said speculators were either rolling positions into the April contract out of February before delivery next week, or liquidating positions to take profits at high prices, but selling was muted on Wednesday.
Open interest in February in the latest day fell 18,787 lots to 109,025 contracts, while April's rose 14,834 to stand at 85,153.
February gold on Jan. 6 hit a 15-year high at $431.50. Traders currently view key technical support at $400 and then $398 with resistance above $415.
Spot gold changed hands at $410.40/1.00, above Tuesday's New York close at $409.75/0.15. London's afternoon fix was at $411.00.
COMEX March silver fell 2.0 cents to $6.53 an ounce, moving from $6.625 to $6.50, after Tuesday's 3.8 percent surge. The metal remained below its 6-year peak at $6.795 which was scaled on Jan 12.
Spot silver fetched $6.52/54 against $6.53/55 on Tuesday. Wednesday's fix was at $6.54.
NYMEX April platinum fell $1.10 to $853 an ounce. Spot hit $854.00/859.00.
March palladium lost $1 to $244 an ounce. Spot was indicated at $238.00/243.00.