August 12, 2019 / 9:42 AM / 4 months ago

CORRECTED-PRECIOUS-Gold holds firm above $1,500 on global growth worries

(Corrects 8th paragraph to say Federal Reserve annual symposium at Jackson Hole will be held next week and not later this week)

* Speculators increase net longs in COMEX gold

* Gold prices are up about 17% this year

* Traders see 69% chance of 25 bps US rate cut in Sept

By K. Sathya Narayanan

Aug 12 (Reuters) - Gold rose on Monday, holding above the psychological $1,500 level as investors’ demand for safe-haven bullion increased on concerns over the impact of the trade war between Washington and Beijing on global economic growth.

Spot gold was up 0.5% at $1,504.55 per ounce at 1202 GMT, holding close to last week’s six-year high of $1,510. U.S. gold futures were up 0.6% at $1,517.40 an ounce.

“(There are) fears of slowdown in the global economy, and the trade talks (between the United States and China) are not going the best way,” ActivTrades analyst Carlo Alberto De Casa said. “There is still room for gold to go up.”

U.S. President Donald Trump said on Friday he was not ready to make a deal with China and even called the September round of trade talks into question.

The yen and bonds - also often seen as offering protection from risk - rose, while stocks struggled, hurt by fears a prolonged trade war and Britain’s looming exit from the European Union could tip top economies into recession.

With no sign of trade tensions between the U.S. and China abating, MKS PAMP said in a note that gold could continue to build momentum, with global growth concerns and central bank easing also helping the rally.

Analysts said negative debt yields around the globe were further supporting bullion. Non-interest bearing gold tends to benefit when yields on other assets are low.

Market focus is now on the Federal Reserve annual symposium at Jackson Hole scheduled for next week, with investors seeking greater clarity on the future path of interest rates.

Traders see a 74% chance of a 25 basis-point rate cut by the U.S. central bank this September.

Spot gold may gain further to $1,524, as it has cleared resistance at $1,497 per ounce, Reuters technical analyst Wang Tao said.

Hedge funds and money managers raised their bullish stance in COMEX gold in the week to Aug. 6, the U.S. Commodity Futures Trading Commission (CFTC) said on Friday.

However, with bullion rising as much as 4% last week and up about 17% this year, some argued further gains may be tough to find.

“To achieve higher prices we need more negative surprises in the economic, financial and geopolitical side. If we don’t see further escalation (in trade tensions), we are likely to see gold prices treading water or coming under more pressure,” Commerzbank analyst Eugen Weinberg said.

Elsewhere, silver was up 0.1% at $16.96 per ounce. Platinum was down 0.1% at $858.19, while palladium gained 0.5% to $1,428.94 an ounce. (Reporting by K. Sathya Narayanan in Bengaluru; Editing by Mark Potter, Kirsten Donovan and Jan Harvey)

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