LONDON, May 14: Gld steadied on Wednesday after the dollar reversed gains against the euro, with demand from jewellers in Asia and the Middle East also helping the metal rebound from a one-week trough.

Spot gold hit a low of $859.30 an ounce, its lowest level since May 5, before bouncing to $866.60/867.60 an ounce, steady from $866.55/867.95 late in New York on Tuesday.

In other precious metals, platinum briefly dipped below $2,000 an ounce before rebounding on bargain hunting.

Gold has lost more than 16 percent in value since spiking to a lifetime high of $1,030.80 an ounce on March 17, mostly driven by profit-taking and the dollar’s recovery.

Some analysts pegged key support around $860, which if broken, could drag down the price to $848. The upside target was pegged at $891 an ounce.

The dollar erased gains versus the euro after US consumer prices rose 0.2 per cent in April -- less than the 0.3 per cent gain Wall Street analysts polled by Reuters were expecting after a 0.3 per cent advance in March.

In the physical market in Asia, dealers noted buying from Indonesia and Vietnam but demand from India, the world’s largest consumer, slowed down after the end of the busy festival season.

Premiums for gold bars were steady at 80 US cents an ounce against the spot London prices in Singapore.

The most active June gold futures contract on the COMEX division of the New York Mercantile Exchange fell $2.5 to $867.1 an ounce but off the intraday low of $860 an ounce.

We still favour further downside in gold, silver and palladium as a combination of dollar strength, and profit-taking should weigh on these metals, UBS Investment Bank said in a client note.

Spot platinum hit an intraday low of $1,997 an ounce, but then rebounded to $2,012.50/2,032.50 an ounce. It was still down from $2,037.50 late in New York and well below a record high of $2,290 an ounce hit on March 4.

Palladium fell to $426.50/434.50 an ounce from $430.50/438.50 in late New York, having earlier hit a low of $422 an ounce. Silver rose to $16.78/16.83 an ounce from $16.66/16.72 in New York.—Reuters