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

To: bobby beara who wrote (15372)	8/5/1998 5:15:00 PM
From: goldsnow	Read Replies (2) \| Respond to of 116782

Gold lower in Europe but rebound seen likely 12:16 p.m. Aug 05, 1998 Eastern LONDON, Aug 5 (Reuters) - Gold edged lower in quiet conditions on Wednesday on light selling from the United States, but dealers said they expected bullion to rebound. Gold was last quoted at $287.90/$288.40, slightly down from the previous New York close at $288.10/$288.60. Dealers said gold had edged lower shortly before the afternoon fix after spending much of the day above the $288.00 level. ''A little bit of selling in New York pushed it down on the slightly strengthening dollar but then it met resistance again when it got up to $288.50 and it has eased back since,'' one dealer said. Dealers said gold also suffered from weaker U.S. stock markets. The Dow Jones index dropped more than 70 points when it opened on Wednesday, following on from Tuesday's 300-point plunge. But some dealers said the Dow's woes, coupled with renewed tension in Iraq and the problems of U.S. President Bill Clinton, under siege again over his relationship with White House intern Monica Lewinsky, could bolster gold. ''It looks as if the market is going to strengthen a bit further. The Dow Jones is looking pretty rubbish, Saddam Hussein is starting to stir up some trouble, Clinton is in trouble and a few good signs for gold around. ''There should be some shortcovering,'' one senior dealer said. Iraq's parliament on Wednesday voted unanimously for a freeze in the work of United Nations arms inspectors in Iraq, deepening the latest crisis in the seven-year U.N. effort to disarm Iraq. Gold has been suffering from seasonally slow summer demand, compounded by indications of lower demand in East Asia due to the region's economic downturn. On Wednesday, CIBC Oppenheimer Corp analyst Thomas McNamara said gold prices could rise to $350.00 an ounce by November. ''Once gold passes the psychological price barrier of $320, it will rise very quickly to $350,'' McNamara told Reuters in Kalgoorlie, Australia. McNamara said he expected clarification in the next two months from the newly formed European Central Bank (ECB) over how member banks in the European Union would manage gold assets. ''We expect this clarification around September or October,'' McNamara said. The ECB earlier this year said gold would represent about 15 percent of its total reserves of some $55 billion, equivalent to about 800 tonnes. More than 11,000 tonnes would remain in the hands of the national banks. Silver was last quoted at $5.41/$5.44 an ounce, down from the previous New York close at $5.44/$5.47. Dealers said silver dipped in sympathy with gold. Platinum was up $1.50 at $375.50/$377.50 while palladium was down $1.00 at $287.00/$297.00. ((Marius Bosch, London newsroom +44 171 542 8065, fax +44 171 542 8077. london.commodities.desk+reuters.com)) Copyright 1998 Reuters Limited.