* Palladium hits a record high of $1,606/oz
* Gold edges up for a third consecutive session
* SPDR gold holdings post biggest daily gain since Jan. 18 (Updates prices)By Arijit BoseMarch 19 (Reuters) - Palladium hit its highest ever onTuesday, crossing the $1,600 an ounce mark for the first time asnews that Russia is planning to ban exports of precious metalsscrap fuelled concerns over an already supply-constrainedmarket.Spot palladium was up 0.7 percent at $1,594.08 anounce at 1231 GMT, having hit a record high of $1,606 earlier inthe session."There have been rumours that Russia would restrict exportsof some scrap materials. When the market is as tight aspalladium is, sometimes such news can take on more significancethan it should," said Philip Newman, a director at Metals Focus."It comes back to the fact that you have an underlined tightmarket, where demand is far outstripping global supply."Russia's trade and industry ministry last week said theproposed ban on exports of precious metals scrap and tailingswould last from May 1 to Oct. 31. Russia is a major producer of palladium, which is usedmainly in catalytic converters.
News that China, the world's biggest auto market, willenforce stimulus measures to boost its tiring economy has alsohelped the case for the metal, analysts said.Commerzbank attributed the spike in palladium prices tospeculative buying interest.
Prices have nearly doubled since their mid-August lows andhave already surged about 27 percent this year.
Meanwhile, gold held firm above the key psychological $1,300level as expectations that the U.S. Federal Reserve will strikea dovish tone on interest rates at its policy meeting this weekkept the dollar under pressure. Gold, which bears no yield, tends to suffer when interestrates are rising.
Spot gold gained 0.4 percent to $1,308.48, while U.S.gold futures were 0.6 percent higher at $1,308.80."The dollar is under a little bit of pressure, providingsome support to the metal," Capital Economics analyst RossStrachan said. Indicative of investor sentiment, holdings of the SPDR GoldTrust , the world's largest gold-backed exchange-tradedfund, rose about 1.1 percent on Monday, their biggest one-daypercentage gain since Jan. 18. "The yellow metal has been on a very positive trajectoryover the last six months as central banks have become notablymore dovish around the globe and the dollar has hit a ceiling,"OANDA said in a note."With the global economic outlook a cause for concern, theenvironment looks very favourable for gold."Among other precious metals, silver shed 0.5 percentto $15.37 per ounce, while platinum gained 1.8 percent to$844.83 per ounce, having hit its highest since March 4 at$848.38, earlier in the session.<^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^Palladium prices scale all-time high on investor buying, supplyconcerns GRAPHIC-2019 asset returns: ^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^> (Reporting by Arijit Bose in Bengaluru; Editing by Jan Harveyand Louise Heavens)
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