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PRECIOUS-Gold rises on expected economic stimulus

Published 24/07/2019, 10:05 pm
© Reuters.  PRECIOUS-Gold rises on expected economic stimulus
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* Strong dollar limits bullion's gains

* Spot gold neutral in $1,412-$1,427 range -technicals

* Silver ETFs hit record high (Adds graphic, updates prices)

By Karthika Suresh Namboothiri

July 24 (Reuters) - Gold prices rose on Wednesday on expectations of monetary policy easing from leading central banks to shore up the global economy, though a stronger dollar curbed gains.

Spot gold XAU= was up 0.7% at $1,426.40 an ounce at 1138 GMT but still short of last week's peak at $1,452.60.

U.S. gold futures GCcv1 rose 0.4% to $1,426.80.

Continued strong investment interest and buying in gold, expectations of interest rate cuts, high geopolitical tensions regarding Iran and a gloomy global economic outlook are propping up gold prices today, said Commerzbank (DE:CBKG) analyst Carsten Fritsch.

The European Central Bank (ECB) is expected to signal easier monetary policy when it meets on Thursday. Investors are also looking ahead to the U.S. Federal Reserve's July 30-31 policy meeting, at which it is expected to cut its overnight benchmark lending rate.

Futures FEDWATCH remain 100% priced for a rate cut of 25 basis points from the Fed next week and even imply an 18% chance of 50 basis points.

Concerns about tepid economic growth have prompted central banks around the world to review their stance on monetary policy. The IMF on Tuesday lowered its forecast for global growth this year and next, warning that more U.S.-China tariffs, auto tariffs or a disorderly Brexit could hit growth, weaken investment and disrupt supply chains. interest rates reduce the opportunity cost of holding non-yielding bullion.

Against a basket of other currencies, the U.S. dollar .DXY edged up to a five-week high of 97.755 after gains of nearly 0.5% the previous day. USD/

Reuters technical analyst Wang Tao said that spot gold looked neutral in a narrow range of $1,412-$1,427 and a breakout could suggest a direction. other precious metals, silver XAG= gained 0.8% to $16.52.

"Silver is living up to its reputation of being volatile ... retail and institutional investors are looking into silver ETFs, indicating it is in demand again," said Quantitative Commodity Research analyst Peter Fertig.

Holdings of the largest gold-backed exchange-traded fund (ETF), New York's SPDR Gold Trust GLD , on Tuesday fell 0.25% from Monday. The largest silver-backed ETF, New York's iShares Silver Trust SLV , rose 0.5% in the same period. Holdings of iShares Silver have risen nearly 13% this year - their best year since 2010. GOL/ETF

Silver ETFs HLDTOTALL=XAG tracked by Reuters have risen to record levels at 666.2 million ounces.

In other precious metals, platinum XPT= rose 0.9% to $862 and palladium edged up by 0.2% to $1,529.50.

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