March 8, 2018 / 10:48 AM / a year ago

PRECIOUS-Gold steadies as ECB statement weighs on dollar

    * Euro firms as ECB drops reference to increasing bond buys
    * Platinum market surplus set to shrink this year-WPIC
    * GRAPHIC-2018 asset returns:

 (Releads, updates throughout, adds comment)
    By Jan Harvey
    LONDON, March 8 (Reuters) - Gold steadied on Thursday after
the previous day's slide, with a drop in the dollar against the
euro after the European Central Bank's latest policy statement
reducing pressure on the metal. 
    The ECB said on Thursday that it could extend the bond
purchases it has been carrying out over the past three years to
depress borrowing costs, but it omitted a longstanding reference
to increasing them.             
    That is seen as a precursor to a broader policy revision
later this year to rein in its extraordinary stimulus measures.
    The dollar, which had been buoyed by news that the White
House could exempt key trading partners from the steel and
aluminium import tariffs it proposed last week, edged lower
against the euro after the ECB statement.        
    Spot gold        was at $1,325.54 an ounce by 1328 GMT,
little changed from late on Wednesday, when it touched a
one-week high of $1,340.42 before closing 0.6 percent lower.
U.S. gold futures         were down 0.1 percent at $1,326.10.
    ABN Amro analyst Georgette Boele said the dollar would
remain the key driver of gold prices in the near term. "The only
reason we were up near $1,340 was because the dollar fell
towards the end of last week," she said. 
   Friday's non-farm payrolls data for February, a key barometer
of the U.S. economy, is now being awaited for further clues on
the pace of Federal Reserve rate increases. 
   Gold is highly sensitive to rising U.S. interest rates, which
increase the opportunity cost of holding non-yielding bullion, 
while boosting the dollar, in which it is priced.
   Gold traders are also awaiting further news on plans for U.S.
tariffs on some imported goods. The White House said late on
Wednesday that Canada, Mexico and possibly other countries may
be granted exemptions, at least for a while.             
    Trump will sign a proclamation establishing the tariffs
during a ceremony scheduled for 2030 GMT, a source familiar with
the situation said.
    "Should tariff concerns remain in focus, gold should once
again find its feet," ANZ said in a note. 
    Silver        fell by 0.1 percent to $16.48 an ounce, while
platinum        was down 0.5 percent at $947.87 after touching
its weakest since Jan. 4 at $943.
     The platinum market will be broadly balanced this year as a
drop in supply trims last year's surplus to negligible levels,
the World Platinum Investment Council said on Thursday.
    Palladium        was down 0.2 percent at $966.72 after
dropping to its lowest since Feb. 9 at $961.55 on Wednesday.

 (Additional reporting by Nallur Sethuraman in Bengaluru
Editing by David Goodman)
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