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PRECIOUS-Gold ticks up as Brexit triggered, firm dollar limits gains
March 29, 2017 / 10:39 AM / in 7 months

PRECIOUS-Gold ticks up as Brexit triggered, firm dollar limits gains

    * Holdings of SPDR Gold Trust       drop on Tuesday
    * Silver inches up to one-month high

 (Updates prices; adds comment, second byline, NEW YORK
dateline)
    By Marcy Nicholson and Eric Onstad
    NEW YORK/LONDON, March 29 (Reuters) - Gold edged up on
Wednesday, hovering below Monday's one-month high as uncertainty
about Brexit talks, French elections and U.S. President Donald
Trump's economic policies boosted safe-haven buying and offset a
firmer dollar.
    Spot gold        was up 0.05 percent at $1,252.2 an ounce by
2:27 p.m. EDT (1827 GMT). U.S. gold futures         settled down
0.2 percent at $1,253.70.
    "There are a lot of uncertainties regarding the Trump
reflation trade after the failure last week to overhaul
Obamacare, and uncertainty in Europe with French elections
coming up and the official start today of Brexit negotiations,"
said Carsten Fritsch, analyst at Commerzbank in Frankfurt.
    "The general picture is still positive (for gold) with dips
seen as buying opportunities," he said.
    British Prime Minister Theresa May filed formal Brexit
divorce papers on Wednesday, triggering years of negotiations
that will test the cohesion of the European Union.             
    "The thing that's keeping gold afloat as high as it is, is
the political unknown, mostly out of Europe with the French
election coming up," said Bob Haberkorn, senior market
strategist for RJO Futures in Chicago.
    "Tomorrow, gold will get more direction (from) the GDP
data."
    A firmer dollar        capped gains in gold, as it rose for
the third straight day after Chicago Fed President Charles Evans
said he supported one or two more U.S. rate hikes this year.
            
    Strength in the U.S. currency makes dollar-denominated gold
more expensive for holders of other currencies, potentially
decreasing demand.          
    Independent technical analyst Cliff Green said the gold
price would need to take a breather after failing to break above
its 200-day moving average at $1,260.
    "It is possibly highlighting the upper boundary of a new
consolidation phase with prices likely to experience a rather
choppy, two-way market action in the weeks ahead," Green told
the Reuters Global Gold Forum.
    Holdings of SPDR Gold Trust      , the world's largest
gold-backed exchange-traded fund which is considered a gauge of
investment demand, reported an outflow of 1.8 tonnes on Tuesday.
         
    In other precious metals, palladium prices        slipped
0.7 percent to $786.75 an ounce, after touching a two-year peak
of $815.40 on Friday.
    "With a platinum-palladium differential of less than $160, I
think it will struggle to rise. It also has a very stretched net
long position, which is also at a two-year high," said
Commerzbank's Fritsch.
    Spot silver        was up 0.2 percent at $18.19 per ounce,
after nudging up to $18.24, the highest since March 2.  
    Platinum        rose 0.3 percent to $949.35 per ounce.

 (Additional reporting by Arpan Varghese in Bengaluru; Editing
by Mark Potter and Tom Brown)
  

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