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PRECIOUS-Gold falls below 2-week high on firmer dollar

Published 08/10/2015, 06:05 am
© Reuters.  PRECIOUS-Gold falls below 2-week high on firmer dollar
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* Gold pressured by firmer dollar

* Silver, platinum rise for fourth straight session

* Coming up: FOMC Sept. meeting minutes Thursday 1800 GMT (Updates prices; adds comment, second byline, NEW YORK dateline)

By Marcy Nicholson and Mariana Ionova

NEW YORK/LONDON, Oct 7 (Reuters) - Gold eased on Wednesday, falling from a two-week high on the firmer dollar while losses were capped on expectations that the U.S. Federal Reserve will delay raising interest rates until next year.

Spot gold XAU= fell 0.1 percent to $1,145.86 an ounce by 2:53 p.m. EDT (1853 GMT), after touching $1,153.30, its highest level since Sept. 24.

The market was relatively subdued as traders awaited the minutes from the Fed's September meeting on Thursday at 1800 GMT.

"What the market will be looking for is, how close was the Fed to making a move in the September meeting, and how deep and detailed was the global turmoil discussion in that meeting," said Rob Haworth, senior investment strategist for U.S. Bank Wealth management in Seattle.

"The hedge funds have been either unwinding short positions or taking new long positions as a hedge to Fed inaction. Part of what you're getting today is truing up those positions; people who aren't getting the price action they expected, maybe taking that off."

Wall Street and other stock indexes gave up earlier gains as concern grew about the outlook for U.S. earnings and oil prices reversed direction after an early surge. MKTS/GLOB

"In general, riskier assets are doing well," said Georgette Boele, FX and commodity strategist at ABN Amro. "The sentiment is positive, which means gold is a bit hurt."

A stronger dollar .DXY also weighed on gold by making the metal more expensive for holders of other currencies.

"The market is still mostly being driven by the interest rate expectations," Boele said.

Gold has come under pressure from expectations that the Fed may raise interest rates this year, potentially lifting the opportunity cost of holding non-yielding bullion.

But weak U.S. economic data and caution about the global economy have prompted many to push back expectations. Speculation around the timing of the rise has helped gold prices gain about 3 percent so far this month. urn:newsml:reuters.com:*:nL8N1270L4 urn:newsml:reuters.com:*:nL1N1262HG

In other precious metals markets, silver XAG= rose to a 3-1/2-month high at $16.10 an ounce, rising for the fourth day and gaining 8.5 percent this month so far.

Platinum XPT= also rose for the fourth straight session, climbing to the highest since Sept. 25 at $952 an ounce, extending gains above last week's near seven-year low on fears that the Volkswagen (XETRA:VOWG) emissions scandal could hurt demand for diesel cars, in which the metal is used for catalysts.

Palladium XPD= moved in the opposite direction, easing 1.1 percent to $694.75 an ounce.

(Editing by David Evans and Lisa Shumaker)

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