* Gold on track for strongest week in a month
* No rush to end monetary easing -Fed's Bullard
* Volatile Nikkei keeps Asian stocks on edge
* Coming Up: U.S. durable goods orders; 1230 GMT
(Updates prices)
By A. Ananthalakshmi
SINGAPORE, May 24 (Reuters) - Gold rose on Friday, on track
for its strongest week in a month, after a U.S. Federal Reserve
official said there was no rush to end the monetary easing
programme that has increased the metal's appeal as a hedge
against inflation.
Gold edged up this week as investors sought its safe-haven
status after the dollar and equity markets were hit by factory
data from China and the United States that showed the pace of
manufacturing had slowed.
Spot gold rose 0.16 percent to $1,392.96 an ounce by
0646 GMT, but was still within sight of a two-year low near
$1,321 hit in mid-April.
U.S. gold was little changed at $1,391.60.
Gold has been hammered this year, losing nearly a fifth of
its value, as investors favoured stocks and other risk assets on
the back of strong economic data.
"Gold prices will be stuck in a range for a while, trading
below $1,400-$1,410 an ounce," said Ronald Leung, chief dealer
at Lee Cheong Gold Dealers in Hong Kong.
Global financial markets were spooked earlier this week when
Fed Chairman Ben Bernanke said the U.S. central bank could
decide to start scaling back on its $85 billion in monthly bond
purchases in the next few meetings.
But Bernanke also said the U.S. economy had to show more
signs of progress before the Fed would make that move, helping
gold stay on track for a more than 2 percent gain this week.
St. Louis Fed President James Bullard said on Thursday he
did not think the Fed was "that close" to taking any such
decision, tempering the concern that the bank would move quickly
to end its easy money policy.
Bullard said on Friday that the U.S. inflation would have to
pick up before he voted to scale back monetary policy stimulus
and that this was unlikely to happen in the coming month.
"Despite Bernanke dancing around the question of when the
stimulus will be removed, at this stage, the move is more of a
matter of when rather than if. When it does occur, it could
knock out a key prop from under the gold market going forward,"
said Edward Meir, an analyst with INTL FCStone.
Dealer Leung said the Chinese had slowed down physical
buying ahead of U.S. durable goods data later in the day.
Buyers in China had been active earlier this week lured by
lower prices, helping to push premiums to record highs in Hong
Kong and Singapore.
Holdings in SPDR Gold Trust, the world's largest
gold-backed exchange-traded fund, fell to fresh four-year lows
of 1,018.57 tonnes on Thursday.
Precious metals prices 0646 GMT
Metal Last Change Pct chg YTD pct chg Volume
Spot Gold 1392.96 2.26 +0.16 -16.82
Spot Silver 22.56 0.00 +0.00 -25.50
Spot Platinum 1457.49 -1.12 -0.08 -5.05
Spot Palladium 737.47 3.04 +0.41 6.57
COMEX GOLD JUN3 1391.60 -0.20 -0.01 -16.96 23027
COMEX SILVER JUL3 22.56 0.05 +0.21 -25.39 4034
Euro/Dollar 1.2939
Dollar/Yen 101.72
COMEX gold and silver contracts show the most active months
(Editing by Tom Hogue and Himani Sarkar)
