* Gold jumps to highest since mid March, key milestones in
sight
* Low rate policy bolsters bullish sentiment
* Gold strengthens in euro terms, rise hastened by ECB
outlook
(Changes dateline, byline, adds quotes, updates prices)
By Veronica Brown and A. Ananthalakshmi
LONDON/SINGAPORE, April 11 (Reuters) - Gold prices shot to
their highest in almost three weeks on Monday, setting the
market on a steady course toward $1,300 per ounce, drawing
confidence from an ultra-low interest rate environment.
Weak economic data and uncertainty over U.S. monetary policy
has contributed to risk aversion, boosting investor appetite for
bullion and other assets perceived as safer stores of value,
including the Japanese yen.
Spot gold XAU= rose to $1,254.06 an ounce on Monday, its
highest since March 22. It last stood at $1,247.20 by 0935 GMT,
up 0.6 percent on the day.
"Very loose monetary policy pursued by several central banks
should point to even higher gold prices," Commerzbank (DE:CBKG) analyst
Daniel Briesemann said.
"The ECB also increased its bond-buying purchase and has not
ruled out further measures - that's also a positive," he added.
Briesemann noted gold's progress in euro terms, approaching
the 1,100 euro mark XAUEUR=R . Strong gains in the precious
metal's value across different currency denominations is an
indicator of broad market strength.
Scaled-back expectations for further monetary tightening
this year helped gold to its best quarter in nearly 30 years in
the three months to March.
Fed Chair Janet Yellen said last Thursday that the U.S.
economy was on a solid course and still on track to warrant
further interest rate hikes.
The U.S. central bank raised rates in December for the first
time in nearly a decade.
However, New York Fed President William Dudley on Friday
said the central bank must approach further rate hikes
cautiously and gradually because of lingering external risks to
the U.S. economy, despite some strength at home and welcome
hints of inflation.
The dollar was broadly neutral for bullion markets, trading
flat against a basket of major currency rivals at 94.241, after
slipping 0.2 percent earlier. USD/
Data on Friday showed hedge funds and money managers cut
their net long positions in gold futures and options in the week
to April 5, but still not far from a two-month high.
Assets in SPDR Gold Trust, the world's largest gold-backed
exchange-traded fund, fell 0.22 percent to 817.81 tonnes on
Friday. GOL/ETF
In other precious metals, silver gained around 1 percent to
$15.47 per ounce XAG= , platinum rose 1.5 percent to $971.99
PTT= and palladium XPD= was 0.9 percent higher at 541.44 per
ounce.