SINGAPORE, March 14 (Reuters) - Gold regained some strength on
Wednesday on bargain hunting  after prices dropped about 2 percent in the
previous session, but a firmer U.S. dollar is likely to cap gains after the
Federal Reserve vowed to keep interest rates low until 2014.	
    Investors could still ditch gold in favour of the dollar after Fed Chairman
Ben Bernanke offered no clues on whether there will be another round of monetary
easing, a factor which effectively reduces bullion's safe-haven appeal. 	
     Gold added $1.21 to $1,675.96 an ounce by 0330 GMT after falling to
a low of $1,661.99 on Tuesday, its weakest since late January. Gold rose to a
record of around $1,920 in September on fears the euro debt crisis could stall
global growth. 	
     "Gold is just caught in a downdraft again after Bernanke didn't really talk
about quantitative easing. But there is still this deep-seated theme of central
bank buying and strong retail demand from emerging Asia, particularly China,"
said Nick Trevethan, a senior commodity strategist at ANZ in Singapore. 	
    "The bottom of the market is about $1,650 at the moment, but we won't rule
out another stab at resistance at $1,700. Platinum is now trading at a premium
again to gold for the first time since September. That long-standing discount is
unprecedented." 	
    Platinum rose $10.31 an ounce to $1,691.74 an ounce .   	
    Platinum gained on worries about supply following a month-long stoppage at
the world's second-largest producer Impala Platinum's largest facility,
which the company said cost nearly 200,000 ounces in production and would
probably cut deliveries in April by as much as 50 percent.  	
    U.S. April gold extended losses, falling about 1 percent to
$1,676.40 an ounce, after U.S. economic data boosted investors' risk appetite,
while reduced expectations for further monetary easing by the Fed underpinned
the dollar.	
     The Fed said the economy was "expanding moderately," though growth still
faced significant downside risks. The assessment of the economy's expansion was
unchanged from the Fed's January statement. 	
     Investors are now looking to the Fed's policy meetings in April and June
for decisions about any new directions for policy.	
    The dollar was broadly firmer on Wednesday, having hit a seven-week high
against a basket of major currencies as prospects for further easing by the Fed
faded in the wake of more upbeat U.S. data.  	
    Data in the United States once again indicated a slowly improving domestic
economy, as retail sales recorded their largest gain in five months in February
despite rising gasoline prices.      	
     "Gold has been caught in this kind of range for too long. If it continues
like this, we will all turn into stones here," said a physical dealer in
Singapore.	
    "Personally, I believe the last round of sell down has washed out the long
bullish stakeholders, while those who are interested in taking new positions are
not doing so because they expect the price to go even lower." 	
    In equities, the Nikkei climbed to a seven-month high on Wednesday, boosted
by Wall Street gains after the Fed upgraded its U.S. economic outlook, while
Tokyo blue chips received a further lift from the softer yen. 	
        	
  Precious metals prices 0330 GMT
  Metal             Last    Change  Pct chg  YTD pct chg    Volume
  Spot Gold        1675.96    1.21   +0.07      7.17
  Spot Silver        33.26   -0.12   -0.36     20.12
  Spot Platinum    1691.74   10.31   +0.61     21.45
  Spot Palladium    702.90    2.80   +0.40      7.72
  COMEX GOLD APR2  1676.40  -17.80   -1.05      7.00        11404
  COMEX SILVER MAY2  33.30   -0.28   -0.84     19.29         1327
  Euro/Dollar       1.3068
  Dollar/Yen         83.13
 

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