Gold slips nearly 1 percent on China's interest rate hike

SINGAPORE | Sun Dec 26, 2010 7:40pm EST

SINGAPORE (Reuters) - Spot gold fell nearly one percent on Monday, and other precious metals also declined, after China raised interest rates over the weekend.

On Saturday China's central bank raised interest rates for the second time in just over two months, underscoring concerns that inflation may be entrenched and swift action is needed to get price pressure under control.

Spot gold fell to a one-week low of $1,371.1, before recovering to $1,373.35 an ounce by 7:04 p.m. EST GMT, down 0.8 percent from the previous close.
U.S. gold futures shed 0.4 percent to $1,374.4.
Spot silver fell 1.4 percent to $28.81, and touched a one-week low of $28.75.
Spot platinum declined one percent to $1,706, and spot palladium also fell one percent to $745.5.
China's rate hike is likely to weigh on commodity market on Monday. Commodities have been riding on inflation anticipation in China, a key market for nearly all commodities.
The dollar edged up against a basket of currencies in early trade on Monday.

PRICES
Precious metals prices at 0004 GMT
Metal Last Change Pct chg YTD pct chg Turnover
Spot Gold 1373.35 -10.90 -0.79 25.34
Spot Silver 28.81 -0.40 -1.37 71.18
Spot Platinum 1706.00 -16.50 -0.96 16.29
Spot Palladium 745.50 -7.50 -1.00 83.85
TOCOM Gold 3674.00 -34.00 -0.92 12.73 12674
TOCOM Platinum 4620.00 -63.00 -1.35 5.46 3160
TOCOM Silver 77.00 -1.30 -1.66 48.94 329
TOCOM Palladium 2007.00 -28.00 -1.38 72.27 255
Euro/Dollar 1.3082
Dollar/Yen 82.91
TOCOM prices in yen per gram. Spot prices in $ per ounce.