* SPDR Gold holdings rise by about 6 tonnes this week
By Maytaal Angel
April 12 Gold steadied on Wednesday after
hitting a five-month peak as political tensions simmered,
leaving investor interest in safe havens like the precious metal
largely in tact.
Tarnishing an otherwise brightening outlook for global
growth, tensions continued over the Korean peninsula and the
Middle East, while worries about the upcoming French
presidential election persisted.
Spot gold was mostly unchanged at $1,274.54 per ounce
by 1414 GMT. It hit its strongest since Nov. 10 at $1,279.80
earlier, extending the previous session's near 2 percent gains.
U.S. gold futures rose 0.2 percent to $1,276.8.
"The short term geopolitical impact will likely fade but
(gold) was oversold on expectations of rate hikes and the
reality of muted rate hikes sets up the potential for (further)
upside," said Hamza Khan, head of commodities strategy at ING.
Gold tends to gain when rate hike expectations recede
because lower rates reduce the opportunity cost of holding
The dollar was flat versus a currency basket after
falling on Tuesday, though a general risk-off mood that has
prompted investors to sell the greenback prevailed.
Chinese President Xi Jinping on Wednesday stressed the need
for a peaceful solution for the Korean peninsula on a call with
U.S President Donald Trump.
On Tuesday North Korea warned of a nuclear attack on the
United States at any sign of American aggression, as a U.S. Navy
strike group steamed towards the western Pacific.
Elsewhere, Vladimir Putin said trust had eroded between the
United States and Russia, as Moscow delivered an unusually
hostile reception to U.S. Secretary of State Rex Tillerson in a
face-off over Syria.
In France's presidential race, centrist Emmanuel Macron and
far-right leader Marine Le Pen clung on as frontrunners, but a
far-left veteran has surged into the top four, pushing some
pollsters to calculate the most extreme run-off scenarios.
Gold could resume its rise ahead of the Easter long-weekend,
Jeffrey Halley, senior market analyst at OANDA, said.
"Gold has finally broken and closed above its 200-day moving
average at $1,257.50, which now becomes a support. From a
technical perspective, the way is now clear for a run at $1,300
and possibly higher," Halley said.
Holdings of SPDR Gold Trust , the world's largest
gold-backed exchange-traded fund, rose 0.50 percent to 842.41
tonnes on Tuesday. The ETF has seen about six tonnes of inflows
Spot silver was unchanged at $18.31 an ounce.
Platinum fell 0.6 percent to $961.24 after rising
over 3 percent in the previous session, while palladium
dropped 1.5 percent to $790.
(Additioanl reporting by Nallur Sethuraman in Bengaluru;
Editing by Susan Thomas and David Evans)