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PRECIOUS-Gold steadies as dollar slips, investors await U.S. data

Published 22/12/2016, 10:24 pm
© Reuters.  PRECIOUS-Gold steadies as dollar slips, investors await U.S. data
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* Several U.S. economic indicators due Thursday

* SPDR Gold holdings down over 12 pct since November

* Platinum/palladium ratio: http://tmsnrt.rs/1QjSZAC (Updates throughout, changes dateline from BENGALURU)

By Swati Verma

LONDON, Dec 22 (Reuters) - Gold steadied on Thursday, as the dollar slipped and market participants waited for U.S. economic data due later in the day.

The United States will release a third revision of third-quarter gross domestic product, durable goods orders for November, and weekly initial jobless claims. ECONUS

Spot gold XAU= was little changed at $1,131.17 an ounce by 1101 GMT, while U.S. gold futures GCcv1 were down 0.1 percent at $1,132.40 an ounce.

"Traders have already positioned themselves for a neutral to lower end of the year for gold, with the next support level in the $1,123 area, as the focus remains on the hawkish message of the Fed, which signalled three rate increases in 2017," ActivTrades chief analyst Carlo Alberto de Casa said.

The Federal Reserve raised U.S. interest rates last week for the first time in a year, lifting the dollar to a 14-year high. FRX/

Strong economic data could prompt the Fed to raise rates sooner rather than later, which would put pressure on gold prices. Higher rates lower demand for non-interest-paying bullion, which is priced in the U.S. currency.

The dollar index .DXY was down 0.2 percent against a basket of six main currencies, but was still trading less than a percent away from the 14-year high.

"The dollar is very strong and gold is going to be under pressure till Donald Trump takes over the U.S. presidency and the focus will shift to how his polices are unfolding," Ronald Leung, chief dealer at Lee Cheong Gold Dealers in Hong Kong, said.

Holdings of the SPDR Gold Trust GLD , the world's largest gold-backed exchange-traded fund, continued to fall on Wednesday, losing 0.4 percent to hit 824.54 tonnes. Holdings are down over 12 percent since November. GOL/ETF

Spot gold looks neutral in a range of $1,121-$1,137 per ounce, and an escape could indicate a direction, according to Wang Tao, Reuters analyst for commodities technicals. XAG= slipped 0.6 percent to $15.84 an ounce. Platinum XPT= was down 0.7 percent at $908.25 and palladium XPD= fell for the seventh straight session, down 0.2 percent at $657.

The spread between platinum and palladium contracted sharply to its narrowest in nearly 15 years earlier this month at $141 an ounce, as a result of palladium's outperformance. The autocatalyst metal has risen 16 percent this year, while platinum has gained 2 percent. The spread is currently at around $250, having averaged $465 over the last 30 years.

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http://tmsnrt.rs/1QjSZAC

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