US MIDDAY: gold rises

Gold prices rose nearly 1 percent on Thursday, set for a 10th straight quarterly gain, as the dollar fell against the euro and as oil rallied on Middle East supply worries. Ultra-loose monetary policies by central banks, euro zone debt fears and political unrest across the Middle East have been major drivers for gold, although the metal is on track to end the first quarter with its smallest gain since the third quarter of 2008, before the financial crisis took hold.
"Gold just managed by a whisker to produce another positive quarter, the 10th in a row. Overall, the performance was not impressive amid the multitude of uncertainties that the world had to deal with during the first three months of 2011," said Ole Hansen, senior manager at Saxo Bank.
Spot gold rose 0.9 percent to $1,436.69 an ounce by 12:28 pm EDT (1628 GMT). US gold futures for June delivery rose 0.9 percent to $1,438.20. The metal was set to notch its biggest one-day gain in nearly two weeks, a day before Friday's US non-farm payrolls for March, considered a key indicator of the health of the US economy.
Investors bought gold to hedge against uncertainty related to Friday's job report, and as oil rallied as Middle East protests and unrest and Libya's conflict kept threats to crude supply in focus, analysts said. Silver gained 0.6 percent to $37.67 an ounce. Silver is on track for a ninth consecutive quarterly gain, with a 22 percent increase in the first three months of the year, as investors bet on further gains in gold and expectations that industrial demand will improve.
Earlier in Thursday's session, the gold/silver ratio dropped below 38, its lowest level since 1983. Gold was also supported as the euro outperformed the dollar on inflation data that firmed expectations the European Central Bank would raise interest rates, but the unit's strength may prove temporary, with peripheral debt issues seen persisting in the second quarter. Platinum rose 0.4 percent to $1,772.74 an ounce, while palladium gained 1.5 percent to $763.22.