MARKET REPORT

Gold futures fell 1 percent on Friday, finishing the week on a weak note as a dollar rise dampened investor sentiment, but palladium rose sharply on strong investment demand related to the U.S. exchange traded funds. Silver holded its nerve in restricted its losses and ended a tad higher on COMEX.

NEW BITES

1. The world’s largest gold-backed exchangetraded fund, SPDR Gold Trust, said its holdings stood at 1,112.836 tonnes as of Jan 17, down 0.914 tonnes or 0.08 percent from the previous business day.
2. The world’s largest silver-backed exchange- traded fund, the iShares Silver Trust, said its silver holdings stood at 9,339.19 tonnes as of Jan 15, same as the previous business day.
3. Purchases from gold jewellers in India stirred up physical trade in Asia, while a drop in bullion prices ignited demand from other consumers in the region and kept premiums steady, dealers said on Friday.
4. Red Back Mining Inc said it forecast higher gold production in 2010 following the completion of major plant expansions at both its Chirano mine in Ghana and Tasiast mine in Mauritania. The African-focused gold miner expects total production for 2010 in the rage of 485,000 ounces to 525,000 ounces at a cash operating cost between $390 and $420 per ounce.
5. Gold jewellery exports from Italy likely declined 20 percent in value in 2009, figures produced for the Fiera di Vicenza jewellery trade fair showed on Saturday.
6. Italian jewellers are focusing on high-end design and innovation to fight off competition from mass-market manufacturers and see China as a key source of customers, according to the World Gold Council.

We expect dollar to trade firm for the day which may weigh on the rise in precious metals prices.

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