The precious metals continued to hold ground within their recent trading ranges Wednesday with the metals gaining initially in Asia and Europe as markets interpreted comments from the head of the Peoples Bank of China as positive for risk before the metals gave back ground during US trade as the dollar strengthened and equities turned negative. The metals were up a net 0.3% at the close having been up as much as 0.9% around the start of US trade; pressure during after-market trade led the complex into negative territory.

A pledged by People’s Bank Governor Zhou Xiaochuan to maintain its holdings of euro assets and invest in Europe’s bailout funds gave equities and the euro an initial boost. In a speech Mr Xiaochuan said “China will always adhere to the principle of holding assets of EU sovereign debt.” “We would participate in resolving the euro debt crisis.” Reaction led the Eurozone Stoxx 50 Index to close up 0.2%; however US markets turned negative with the Dow settling down 0.75% and the S&P500 0.5% as Eurozone officials said Greece would need tighter oversight over its budget before it receives another bailout while the minutes of the last FOMC meeting revealed members were willing to carry-out another round of bond purchasing should the economy lose momentum.

Further risk aversion has been seen overnight with equities losing ground; the Nikkei was off 0.25% at the time of writing while the MSCI Asia Pacific Index was off over 1%. The euro has also weakened amid growing concerns Greece could miss next month’s debt payment deadline after EU officials postponed its decision on the €130bn of financial aid scheduled for yesterday. EUR/USD was off 0.4% the Dollar Index was up 0.25%.

Data overnight showed Australia added 46,300 jobs last month while the Unemployment Rate declined from 5.2% to 5.1%. The line-up for the rest of the day includes the ECB Monthly Bulletin, US Jobless Claims, PPI, Building Permits & Housing Starts and the Philly Fed Manufacturing Index; Fed Chairman Bernanke is also scheduled to speak.

After a steady start the precious metals have run into fresh pressure at the start of todays European trade with the complex currently off a net 1.3% after palladium broke below recent support around $680 while silver and platinum are currently testing support at $33 and $1600. Gold is expected to find further support back towards $1700 however a breach of $32.90 in silver and $1590 in platinum could trigger additional pressure suggesting tests to $31.85 and $1565 respectively.

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