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PRECIOUS-Gold near 4-wk low on US rate hike fears, fund outflows

Published 04/11/2015, 11:47 am
Updated 04/11/2015, 11:50 am
© Reuters.  PRECIOUS-Gold near 4-wk low on US rate hike fears, fund outflows
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SINGAPORE, Nov 4 (Reuters) - Gold steadied after a five-day slide on Wednesday, but continued to languish near its lowest in four weeks, hurt by fears of a U.S. rate hike this year and investor outflows.

FUNDAMENTALS

* Spot gold XAU= had ticked up 0.4 percent to $1,121.30 an ounce by 0036 GMT, after sliding over 4 percent in the last five sessions.

* The metal slumped to $1,114.10 on Tuesday, the lowest since Oct. 2. U.S. gold futures GCcv1 also slid to a one-month low of $1,113.60 in the previous session.

* Bullion has been under pressure since the Federal Reserve last week hinted at a rate hike in December, reversing earlier market expectations that the first U.S. rate increase in nearly a decade could be delayed to next year on global growth concerns.

* Gold tends to benefit from very low rates as a non-interest-paying asset.

* Strength in the dollar and equities were also dragging on gold. Asian shares rose on Wednesday, taking early cues from overnight Wall Street gains, while sharper risk appetite from investors lifted U.S. debt yields and supported the dollar. MKTS/GLOB

* Soft economic data on Tuesday failed to lift gold. New orders for U.S. factory goods fell for a second straight month in September as the manufacturing sector continues to struggle under the weight of a strong dollar and deep spending cuts by energy companies. urn:newsml:reuters.com:*:nL1N12Y1IL

* Bullion traders are waiting for more U.S. data to gauge the strength of the economy and its impact on the Fed's monetary policy.

* All eyes will be on the U.S. nonfarm payrolls report due on Friday, while the ADP employment report and ISM report on services sector sentiment due later on Wednesday could also be market movers.

* Investor outflows from gold continued and were likely to trigger more price declines.

* SPDR Gold Trust GLD , the world's largest gold-backed exchange-traded fund, said its holdings fell 0.43 percent to 686.30 tonnes on Tuesday - the lowest in five weeks.

* For the top stories on metals and other news, click TOP/MTL or GOL

DATA AHEAD (GMT)

0145 China Caixin services PMI Oct

0850 France Markit services PMI Oct

0855 Germany Markit services PMI Oct

0900 Euro zone Markit services PMI Oct

1000 Euro zone Producer prices Oct

1315 U.S. ADP national employment Oct

1330 U.S. International trade Sep

1500 U.S. ISM non-manufacturing PMI Oct

PRICES AT 0036 GMT

Metal

Last

Change Pct chg

Spot gold

1121.3

4.09

0.37 Spot silver

15.255 -0.015

-0.1 Spot platinum

964.1

4.86

0.51 Spot palladium

643.67

2.2

0.34 Comex gold

1121

6.9

0.62 Comex silver

15.28

0.041

0.27

COMEX gold and silver contracts show the most active months

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