>Asia spot gold creeps higher, awaits FOMC

Sydney - Spot gold rose in Asia Tuesday on the back of light buying in light of a steadier dollar, but trading activity was muted before the end of the Federal Open Market Committee meeting Wednesday.

Bullion price direction continues to be dominated by the dollar, and a steadier tone in the currency market after Friday's strong upward move allowed gold to rise off levels close to 10-day lows.

Market participants were awaiting the end of the FOMC meeting, with comment from Federal Reserve Chairman Ben Bernanke on the economic outlook and money supply in focus, said Ronald Leung, director at Lee Cheong Gold Dealers.

The committee is expected to leave interest rates unchanged.

At 0714 GMT, spot gold traded at $947.80 a troy ounce, up $1.20 on the New York close.

Prices are expected to stay in a $930-$960/oz range, with reduced volumes during summertime trading potentially pushing large intraday swings, said RBS head of precious metals Charles Dowsett.

"Volumes in the market are thin due to a lack of interest, so we're likely to get large (price) swings for the time being," Dowsett said, adding gold traditionally rallies toward year end, with prices starting to pick up in September-October in time for Christmas.

In the news, the SPDR Gold Trust exchange traded fund shed a smidgen more from its gold holdings, falling 0.35 metric tons to 1,068.55 tons as of Aug. 10.

At 0723 GMT, spot silver traded at $14.46/oz, up 12 cents. Platinum was up $5.00 at $1,250.00/oz and palladium down $1.00 at $272.00/oz.

On Tocom, benchmark June 2010 gold futures were down Y31 at Y2,962 a gram and platinum futures were also lower, down Y17 at Y3,892/gram.

Source: COMMODITIESCONTROL