December 2, 2019 / 4:44 AM / 4 days ago

PRECIOUS-Gold slips on firm dollar, positive China factory data

 (Updates prices)
    * Gold to trade between $1,450-$1,500/oz until year-end-
analyst
    * China's Nov factory activity expands at quickest pace in 3
years
    * U.S. manufacturing PMI data due later in the day

    By Sumita Layek
    Dec 2 (Reuters) - Gold prices fell on Monday as investors
turned to riskier assets on signs of economic growth following
reports of an expanding Chinese factory sector and as a rising
dollar reduced demand.
    Spot gold        was down 0.5% at $1,456.70 per ounce by
0802 GMT, having earlier touched its highest since Nov. 22. U.S.
gold futures         fell 0.7% to $1,463.
    An unexpected expansion in factory activity during November
in China, the world's second-largest economy and biggest gold
user, spurred investors into equity markets.             
            
    This followed official government data on Saturday that also
showed an expansion.             
    "Positive data from China creates an optimism that the
Chinese market is improving, that gives people confidence to
invest in riskier assets, and in turn, reduces the safe-haven
demand for gold," said Hareesh V, head of commodity research at
Geojit Financial Services.
    Manufacturing surveys for Europe and United States are due
to be released later on Monday. 
    Investor demand for gold was further pressured by the rising
dollar, which makes dollar-denominated gold more expensive for
buyers using other currencies.       
    The uncertainty around a resolution to the 17-month-old
trade dispute between the United States and China has supported
gold, with reports that a preliminary agreement has now stalled
because of U.S. legislation supporting protesters in Hong Kong
and Chinese demands that the United States roll back its tariffs
as part of phase one deal.                          
    "Nothing particularly has really changed (on the trade
front) from last week, the market remains in the dark about how
things will progress. Investor appetite for gold is just waning
a little bit on lack of direction," ANZ analyst Daniel Hynes
said.
    Gold has risen more than 13% this year mainly due to the
trade dispute driving demand for safe assets.    
    "The fundamentals are still quite supportive, this lull is
not going to last too much longer. Maybe into year end we will
see gold prices recommit the uptrend we saw earlier this year,"
Hynes said, adding until then gold will trade between
$1,450-$1,500.
    Spot gold may test a support at $1,455 per ounce, a break
below which could cause a fall to $1,440, according to Reuters
technical analyst Wang Tao.             
    Elsewhere, silver        fell 1% to $16.85 per ounce,
platinum        was down 1.3% to $888.50 and palladium       
was slipped 0.2% at $1,838.

 (Reporting by Sumita Layek in Bengaluru; Editing by Sherry
Jacob-Phillips, Kirsten Donovan)
  
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