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RPT-Surging NY palladium, silver eclipse sluggish gold

(Repeating to fix typo in headline)

NEW YORK, Jan 22 (Reuters) - New York gold easied Thursday, marking time as the dollar consolidated while overshadowed by a speculative buying binge in palladium, which has transformed from a laggard to the star precious metal of 2004.

Palladium rose 5.9 percent Thusday and is up 27 percent this year. It outperformed sister metal platinum and even a 2.3 percent gain in volatile silver futures.

February gold settled off $1.10 at $410.10 an ounce, retreating from a high of $413.30 to $408.30 as the euro reversed overnight gains against the dollar. Estimated volume was 80,000 contracts, of which 12,440 were switches to April in the run up to first notice day next week.

News of a fall of 1,000 in claims for U.S. unemployment benefits to 341,000 last week shored up the dollar from Wednesday's fall against the five-year-old European currency.

"Overall not a whole lot is going on -- a downward reaction in gold, a better reaction in the dollar to jobless claims," said James Pogoda, a vice president of precious metals at Mitsubishi International Corp.

February gold is down more than one percent for the year. It hit a 15-year high on Jan 6 at $431.50 as the euro was moving toward the lifetime high at $1.2898 hit last week before the European Central Bank started expressing concern about "brutal" foreign exchange movements.

Pogoda said it would take a dollar rise above perhaps $1.26 or $1.25 per euro, to knock gold back to the $400 level.

"On the flip side," he said, "if we see no strength in the dollar, if the jawboning kind of stops or if jawboning is blown off (ignored) and we ... start trying up near $1.29 again, you have to think we'll take a peak on upside in gold and try resistance up around $417/418."

Gold was also constrained by Wednesday's request by the Bundesbank for an option to sell 600 tonnes of bullion reserves if the Central Bank agreement limiting European sales is renewed for another five years in September.

Germany has long made noise about starting to reduce their holdings, the second largest after the United States. But Pogoda said 600 tonnes seemed small, "almost bullish," compared to the 1,300 tonnes Switzerland is selling under the pact.

Spot gold closed at $409.20/9.80, down from $410.10/0.70 Wednesday. London's late fix was at $409.25.

March silver jumped 14.2 cents to $6.35 an ounce, reversing Wednesday's 11.5 cent slide. It touched $6.41 and $6.165. Spot silver rose to $6.33/35 from $6.19/21 at the prior close. The fix was $6.26.

NYMEX April platinum went up $6.60 to $862.20 an ounce. Spot fetched $865.00/870.00.

Palladium broke higher on Wednesday and continued its rally to levels last traded in March 2003. March rose $14.20 to $254.35, setting a contract high at $255.50. Spot was priced at $246.00/251.00.

The white metal, used primarily by car manufacturers in catalytic converters to clean exhaust fumes, had caught the attention of funds because it was the only precious metal not to start the year with a big gain. A rise in platinum to 24-year highs has rekindled interest in cheaper palladium as an alternative catalyst.

Ralph D'Esposito of RJ Futures said fund and speculative buying was massive. "With open interest bigger than platinum, what we're going to see more of is selling platinum against the palladium."