Precious Metals Update

Spot gold holds at $663.50/oz, down from the $665.70 high seen in the US session and up from an o/n low of $657.70.

The run-up in gold and silver was sparked by the earlier rally in oil over $60.

There also have been a bit of safe-haven demand in the wake of Iran's threat to target US assets if the country is attacked in response to its nuclear program.

The market now targets a retest of the $676 high from last July.

No real response to comments by US Tsy Sec Paulson, who said the US is open to studying Gold Sales by the IMF.

As a reminder, any agreement on future IMF gold sales would need to be approved by a majority of the fundshareholders as well as by the US Congress, which holds 17% of thevoting power.