Gold steadies while silver hits a 30-year high (Reuters) (03-01-2011)

SINGAPORE – Spot gold was steady on Monday after gaining 30 percent last year while silver rose to a 30 – year peak above $31 on a bullish market outlook for this year.

Spot gold was little changed at $1,418.90 an ounce by 0844 GMT (3:44 a.m. ET). It touched $1,421 earlier, after a three-week high of $1,421.15 hit on Dec 31 and is expected to fall toward $1,370 per ounce.

On the first trading day of the year and with thin volumes, the precious metal was expected to trade between $1,410 and $1,425.

U.S. gold futures edged down 0.1 percent to $1,419.5.

Spot silver touched a 30-year high of $31.02, and retraced to $30.92. It posted an 83 percent gain in 2010, following top performer palladium's 97 percent rise.

Holdings in the world's largest silver-backed exchange-traded fund, iShares Silver Trust, rose for the first time since December 17 to 10,921.57 tonnes by December 31 from 10,903.34 tonnes.

Among the markets, India gave its approval to seven more banks to import gold and silver, bringing the number of banks with gold-import license to 30. The move was seen to smoothen the flow into the world's top gold consumer.

Spot platinum rose to $1,775.50, its highest since Nov 10, before easing to $1,772.

Gold and other precious metals still enjoy bullish outlook, as economic uncertainties and inflation worries keep fanning safe-haven demand, while an improved economic outlook underpins strength in silver as well as platinum group metals, which are used in various industries.

The dollar gained nearly half a percent on Monday, building on gains from 2010, as investors gear up for gains in early 2011 on expectations the U.S. economic recovery was gaining momentum.

Source: Reuters