Platinum prices remained firm as lease rates continued to move higher with the one-month rate around 56 per cent on Friday, indicating a severe tightness in the platinum market.

Gold was last quoted at $321.00/$323.00 a troy ounce from the New York close at $322.30/$324.30. Lease rates were around 4.2 per cent, down from last week's highs of 10 per cent but still above the usual 0.50 to 2.0 per cent.

Bullion slipped in Asia after Japanese finance minister Kiichi Miyazawa said he did not intend to aggressively sell Japan's gold holdings, but said he also does not want to "aggressively hold" on to the gold.

Miyazawa told a regular briefing: "Japan is not agressively buying or holding gold as we perceive holding gold doesn't help our foreign exchange reserves very much."

Gold dropped to around $316.00 after Miyazawa's comments, but London dealers said short-covering in late Asia and early Europe pushed the price higher.

Dealers expected bullion to consolidate further on Friday. "It is probably the eye of the storm. I think next week it will kick off again. "As far as the dealers are concerned, people have to focus on where they are going from here with their positions and the same thing goes for producers and central banks," a dealer said.

He said business will filter back into the market as participants became used to present levels.

Gold has gained more than $50 since September 26, when 15 European central banks pledged to limit gold sales and also curb lending and derivatives activities.

Dealers said gold was supported at $315.00 with next support at $305.00.

"The market looks like it should go higher and a breach of $340 will take us all the way, possibly up to the $370.00 area," one dealer said.

Platinum was last quoted at $427.00/$432.00 a troy ounce, $2 up from the New York close. Lease rates remained at exceptionally high levels, indicating a shortage of metal.

Dealers expected platinum prices to move higher.

"It is up at resistance level. I think it is going to wait for gold," one trader said.

Palladium was last at $390.00/$395.00 compared to the New York close at $388.00/$393.00 and silver was quoted at $5.58/$5.61 from the close at $5.56/$5.60.