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PRECIOUS-Gold firms as dollar slips; U.S. consumer data in focus
November 15, 2017 / 4:10 AM / 5 days ago

PRECIOUS-Gold firms as dollar slips; U.S. consumer data in focus

    * Spot gold neutral in $1,270-$1,286/oz range - technicals
    * GRAPHIC-2017 asset returns: tmsnrt.rs/2jvdmXl

 (Updates prices, recasts first graph)
    By Vijaykumar Vedala
    Nov 15 (Reuters) - Gold prices edged higher on Wednesday as
the dollar slipped ahead of the release of October consumer
inflation data from the United States later in the day that
could provide hints on the Federal Reserve's monetary tightening
policy.
    Spot gold        was up 0.3 percent at $1,284.30 per ounce
at 0811 GMT. On Tuesday, gold touched $1,270.56, its lowest
since Nov. 6, before recovering to close 0.2 percent higher.
    U.S. gold futures         for December delivery gained 0.1
percent to $1,284.50.
    "Gold is still stuck in a tight range as traders are waiting
for additional signals before taking any view," ANZ analyst
Daniel Hynes said.    
    "This (U.S. consumer inflation data) is one of the most
important data, which could dictate sentiment leading into the
next Fed meeting. Obviously, a rise in inflation is what the
market is looking for ... but for now, it is taking a cautious
approach," Hynes added.
    The Federal Reserve should keep its benchmark interest rate
at current levels until there is an upswing in inflation, St.
Louis Fed President James Bullard said on Tuesday.             
    One of the newest Fed policymakers, Raphael Bostic, said he
still backs a December interest-rate hike and that he would need
to see further weakness in U.S. inflation and local signs of
economic weakness to cause him to shelve expectations for
gradual policy tightening.                  
    Higher interest rates tend to boost the dollar and push bond
yields up, putting pressure on gold prices by increasing the
opportunity cost of holding non-yielding bullion.
    "We expect the Fed to hike (interest rate) by 25 bps in
December 2017 and given the unusually weak physical market, gold
prices are likely to be subject to downside risk in the near
term," Standard Chartered said in a note.  
    "The two key near-term drivers for gold remain the U.S. tax
bill and the upcoming Federal Open Market Committee meeting."   
    U.S. Senate Republicans on Tuesday linked repealing a key
component of Obamacare to their ambitious tax-cut plan, raising
new political risks and uncertainties for the tax measure that
financial markets have been monitoring closely for
months.                
    Spot gold looks neutral in a range of $1,270-$1,286 per
ounce, and an escape could suggest a direction, according to
Reuters technical analyst Wang Tao.             
    The dollar index       , which tracks the U.S. currency
against a basket of six major rivals, fell 0.3 percent.      
    In other precious metals, silver        gained 0.5 percent
to $17.10 per ounce, while platinum        was up 0.4 percent at
$929.50.
    Palladium       , which touched a two-week low of $974.97 an
ounce in the previous session, rose 0.2 percent to $987.30 an
ounce. 

 (Reporting by Vijaykumar Vedala in Bengaluru; Editing by
Richard Pullin and Subhranshu Sahu)
  

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