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PRECIOUS-Gold down on firmer dollar after Yellen remarks

Published 29/09/2016, 12:14 am
© Reuters.  PRECIOUS-Gold down on firmer dollar after Yellen remarks
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* Traders watching Algiers oil producers' meeting

* SPDR Gold holdings fall 0.22 percent on Tuesday

* Silver down for fourth straight session (Updates prices, adds comment)

By Clara Denina

LONDON, Sept 28 (Reuters) - Gold prices hit a one-week low on Wednesday, as the dollar firmed and investors assessed Federal Reserve Chair Janet Yellen's testimony before a Congressional committee.

The Federal Reserve is considering changing the annual stress tests it gives to U.S. banks to see if they can withstand a massive financial crisis, Yellen said.

The Fed's chair did not comment on the outlook for the economy or monetary policy in her prepared remarks. gold XAU= fell 0.4 percent to $1,322.95 an ounce by 1409 GMT. It fell nearly one percent on Tuesday, its biggest single-day loss in one month on a higher appetite for risk.

U.S. gold futures GCcv1 eased 0.3 percent to $1,326.20 an ounce.

Gold's next technical support level stands at $1,320, while the closest resistance is $1,350, MKS SA head of trading Afshin Nabavi said.

Minneapolis Fed President Neel Kashkari said the central bank could keep rates low for a while as inflation remains weak. markets will also monitor Cleveland Fed President Mester and Kansas City Fed President George's speeches on the economy and monetary policy at separate events.

"It is probably going to be a case of watching out for these Fed officials' comments," Mitsubishi Corp analyst Jonathan Butler said.

"We also have Friday's U.S. inflation reading, which is the bank's preferred measure of inflation and if that shows tick up towards the 2 percent target, it would give more confidence to markets that the Fed will move to raise rates in December."

Butler added that traders were also watching a meeting of oil producers in Algiers this week to see if an agreement could be reached to ease a global glut of crude. O/R

Gold is often seen as a hedge against oil-led inflation.

The dollar .DXY was up 0.1 percent against a basket of six major currencies, making gold more expensive for foreign currency holders. FRX/

Holdings of the SPDR Gold Trust GLD , the world's largest gold-backed exchange-traded fund, fell 0.22 percent to 949.14 tonnes on Tuesday. GOL/ETF

Spot silver XAG= was down for the fourth straight session, losing 0.4 percent at $19.06 an ounce. The metal fell 1.4 percent in the previous session, its biggest single day loss in nearly three weeks.

Platinum XPT= was down 1.1 percent at $1,010.25 after falling over 1 percent in the prior session.

Palladium XPD= was up 1.3 percent at $706.80 an ounce.

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