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Gold/Mining/Energy : Gold Price Monitor -- Ignore unavailable to you. Want to Upgrade?

To: Broken_Clock who wrote (12316)	5/28/1998 6:29:00 PM
From: goldsnow	Read Replies (1) \| Respond to of 116837

Gold edges higher, palladium slumps in Europe 11:06 a.m. May 28, 1998 Eastern LONDON, May 28 (Reuters) - Gold moved higher in quiet trade in Europe on Thursday and was seen range-bound in the short-term while palladium dropped lower on rumours that Russia had been selling metal. Gold was last quoted at $294.00/$294.50 an ounce from the previous New York close of $293.60/$294.10. Bullion fixed slightly higher in the afternoon at $294.00 from the morning fix at $293.40. Dealers said gold recovered after Wednesday's news that the Swiss Federal government approved a draft law which would sever the Swiss franc's link to gold, paving the way for the Swiss National Bank to sell around 1,300 tonnes of gold, or half of its reserves. The plan to revalue and gradually sell gold reserves, already widely known in the bullion market, requires parliamentary approval, amendment of the Swiss constitution and must be endorsed by Swiss voters in a referendum. Bullion lost a dollar as the news first emerged on Wednesday, recovering that and more in short-covering during the remains of the day's trade. ''After the announcement yesterday there are enough short around to keep gold above $290.00 at the moment,'' one dealer said. He said gold should trade in a range between $290.00 and $295.00 for a while and said Thursday's slight recovery was a mini-correction. ''I think the market overreacted to that story yesterday,'' the dealer added. Silver was holding well and last quoted at $5.20/$5.23 against the previous New York close of $5.18/$5.21. ''Silver has been fairly well bid this afternoon, especially on the COMEX. The market was caught short yesterday on the back of gold and what we have seen today is a correction induced by professional short-covering,'' the dealer said. Palladium slumped on Thursday, fixing at a seven-week low in the afternoon as dealers spoke of persistent but unidentified sales of physical metal. ''We have seen some very good selling from palladium but we are not sure where it (metal) is coming from,'' one dealer said. Spot palladium was last quoted at $297.00/$307.00 from the previous close at $322.00/$332.00. It was fixed at $297.00, $120 from its all-time record high fix of May 18. Russia, the world's main palladium supplier, has exported no metal officially this year, repeating the supply disruption of 1997, when exports were frozen for the first six months amid bureaucratic delays and power struggles. ''You have to go along with the rumour that the Russians are selling. The price is down, lease rates are down which means there's metal around and metal is being sold,'' another dealer said. Platinum was also lower with spot last at $365.00/$367.00 down from the previous close of $374.10/$376.10. ((Marius Bosch, London newsroom +44 171 542 8065. Fax +44 171 542 8077. london.commodities.desk+reuters.com)) Copyright 1998 Reuters Limited.