>Spot gold eases ahead of ECB rate decision

London - Spot gold lost early gains Thursday as the dollar strengthened ahead of interest rate decisions from the European Central Bank and the Bank of England.

With the ECB expected to keep its benchmark rate unchanged, the gold market instead was looking to oil prices and Friday's U.S. jobs data for direction, traders said.

At 0933 GMT, spot gold was 0.15% lower at $960.50 per troy ounce.

Gold remains up 3% above its level a week ago, but its failure to break $970/oz in the past two days indicates a short-term ceiling for the metal, traders said.

"It looks like we're stuck in a range," said Afshin Nabavi, head of trading and physical sales at MKS Finance in Geneva. On the downside, $959-$960 should provide near-term support, Nabavi added.

Analysts expect the dollar to remain as gold's key swing factor, but many predicted limited upside for gold if equities continue on the uptrend.

Citigroup analyst David Thurtell said the relatively listless tone in gold reflected the dwindling interest in the metal among investors. "With equities rallying, money's going out of gold and into equities," Thurtell said.

A rally to the $1,000/oz level isn't likely until the end of the year, when rising commodity prices are likely to prompt investors to buy gold as an inflation hedge, even though statistically the two aren't well correlated, Thurtell added. "If enough people do [think gold is a hedge], then it's silly to fight the trend."

Gold's higher prices this week have also prompted some scrap gold selling in East Asia, which could grow larger if prices rise, traders said.

In other metals, spot silver was 0.2% lower at $14.672/oz, spot platinum was down 0.6% at $1,275/oz and spot palladium was 0.2% at $272.50/oz.

Platinum remained less than 1% below Wednesday's two-month high of $1,287.50/oz, underpinned by worries of a strike at South Africa's power utility Eskom.

The country's biggest trade union Wednesday said a strike early next week was "inevitable."

South Africa produces three-quarters of the world's platinum, and is one of the world's biggest gold producers.

Source: COMMODITIESCONTROL