August 30, 2018 / 12:58 AM / 3 months ago

PRECIOUS-Gold steady as dollar dips; rate hike expectations cap gains

BENGALURU, Aug 30 (Reuters) - Gold prices held steady on Thursday, after rising nearly half a percent in the previous session, as the dollar edged down, but views on higher U.S. interest rates limited gains.

FUNDAMENTALS

* Spot gold was mostly unchanged at $1,205.58 an ounce at 0028 GMT. Prices hit their highest since Aug. 10 at $1,214.28 on Tuesday.

* U.S. gold futures were also mostly steady at $1,211.82 an ounce on Wednesday.

* The dollar index, which measures the greenback against a basket of currencies, was down 0.1 percent at 94.528.

* Gross domestic product grew at a 4.2 percent annualized rate, the Commerce Department data showed in its second estimate of GDP growth for the second quarter. That was slightly up from the 4.1 percent pace of expansion reported in July.

* The data cemented expectations for a U.S. rate hike next month, with a 96 percent probability, according to fed funds futures.

* The U.S. Federal Reserve should be ready to lift interest rates for a longer period or even more quickly than currently expected to insure against a jump in inflation in a U.S. economy operating in the vicinity of full employment.

* Higher rates dent the appeal of non-interest-yielding gold.

* The leaders of the United States and Canada expressed optimism on Wednesday that they could reach new NAFTA deal by a Friday deadline as negotiators prepared to talk through the night, although Canada warned that a number of tricky issues remained.

* Asian stocks rose on Thursday as Wall Street hit record highs in the hope that the current North American Free Trade Agreement (NAFTA) negotiations will lead to a further easing of global trade tensions.

* The first support for gold is at $1,200 per ounce and the next key level is $1,180, said ActivTrades chief analyst Carlo Alberto De Casa. Rising above $1,210 would be a first positive impulse, he added.

* A strike at AngloGold Ashanti’s Siguiri gold mine in Guinea has halted operations there, mines ministry secretary-general Saadou Nimaga said on Wednesday.

* Three South African unions said on Wednesday that wage negotiations in the gold sector had hit a deadlock and they had declared a dispute, a move that is one step short of a strike.

DATA AHEAD (GMT)

0600 Germany Import prices July

0755 Germany Unemployment rate Aug

0900 Euro zone Business climate Aug

1200 Germany Consumer prices Aug

1230 U.S. Personal income July

1230 U.S. Weekly jobless claims (Reporting by Nallur Sethuraman in Bengaluru; Editing by Vyas Mohan)

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