PRECIOUS-Gold rises on dollar drop, Fed's Bullard comment
* Fresh buying near $1,300 per ounce, some short covering
* Fed should not rush to taper -St. Louis Fed's Bullard
* Indian gold demand muted during key Diwali festival
NEW YORK/LONDON, Nov 4 (Reuters) - Gold rose in quiet trade on Monday, lifted by a dollar drop and comments by a senior Fed official that the U.S. central bank should keep up its monetary stimulus. Bullion investors looked toward U.S. jobs data later this week for trading cues. The precious metal was moving in a $10 range with less-than-average turnover due to a light schedule of U.S. economic indicators on Monday, traders said. Gold prices were supported after St. Louis Federal Reserve President James Bullard told CNBC television that the Fed should not rush a decision to scale back its asset purchase program because of low inflation. Some investors stayed on the sidelines ahead of Friday's all-important October U.S. nonfarm payrolls report, which will give financial markets an idea on whether the U.S. central bank will maintain its bond-buying stimulus for a while longer. "Gold is still very dependent on economic weakness and extended quantitative easing to prosper at the moment," said Saxo Bank's head of commodity strategy Ole Hansen. The metal was also underpinned by fresh buying and short covering triggered by a drop earlier in the day toward technical support around $1,300 an ounce, Hansen said. Spot gold was up 0.2 percent at $1,317.30 an ounce by 12:05 p.m. EST (1705 GMT), after falling nearly 3 percent last week. U.S. gold futures for December delivery were up $4 an ounce at $1,317.20. Outflows from gold-backed ETFs resumed on Friday, when holdings of New York's SPDR Gold Shares declined 5.7 tonnes, their largest one-day outflow since Oct. 21.
INDIA PHYSICAL DEMAND WEAK The sharp drop in prices last week has failed to revive physical demand, and some dealers say the price may have to fall below $1,300 to attract more buyers. Indian demand was muted during the biggest gold-buying festivals of Dhanteras and Diwali, celebrated on Friday and over the weekend, with many opting for cheaper silver due to high gold premiums and the scarcity of the metal on the domestic market. Silver was down 0.2 percent at $21.78 an ounce. Platinum was up 0.3 percent at $1,447.70 an ounce and palladium was up 1.1 percent at $745.72 an ounce. Prices at 12:05 p.m. EST (1705 GMT)
LAST NET PCT YTD CHG CHG CHG US gold 1317.20 4.00 0.3% -21.4% US silver 21.795 0.000 -0.2% -27.9% US platinum 1454.50 2.60 0.2% -5.5% US palladium 748.95 10.70 1.5% 6.5% Gold 1317.30 2.56 0.2% -21.3% Silver 21.78 -0.05 -0.2% -28.1% Platinum 1447.70 4.00 0.3% -5.8% Palladium 745.72 7.93 1.1% 6.2% Gold Fix 1320.50 6.25 0.5% -20.6% Silver Fix 21.85 10.00 0.5% -27.0% Platinum Fix 1453.00 4.00 0.3% -4.6% Palladium Fix 745.00 4.00 0.5% 6.6%