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PRECIOUS-Gold marks time ahead of testimony from Fed's Yellen

Published 15/07/2015, 10:46 am
© Reuters.  PRECIOUS-Gold marks time ahead of testimony from Fed's Yellen

MANILA, July 15 (Reuters) - Gold was locked in a tight range early on Wednesday as investors waited for Federal Reserve Chair Janet Yellen's congressional testimony for more clues on the timing of a U.S. interest rate increase this year.

Yellen said last week that the Fed is on course to lift rates at some point this year, but an unexpected drop in U.S. retail sales in June renewed concerns the world's top economy may be slowing again.

FUNDAMENTALS

* Spot gold XAU= was little changed at $1,155.76 an ounce by 0034 GMT, after two days of modest losses.

* A looming U.S. rate hike boosts the dollar, putting dollar-priced assets such as gold out of favour as they become more costly for buyers holding other currencies.

* U.S. gold for August delivery GCcv1 was up 0.1 percent at $1,155 an ounce.

* U.S. retail sales slipped 0.3 percent last month, the weakest reading since February, after May's downwardly revised 1.0 percent increase. ID:nL2N0ZU0S7

* The data came ahead of Yellen's semiannual testimony on monetary policy to the U.S. House of Representatives later on Wednesday at which she is likely to reiterate that it will be appropriate to raise interest rates later this year, a point she again made in a speech last week.

* Before Yellen's testimony, top gold consumer China will release second-quarter gross domestic product data. The world's No. 2 economy is forecast to have grown by 6.9 percent in April-June, its slowest pace in six years. ID:nL4N0ZU22U

* An International Monetary Fund study showed that Greece needs far more debt relief than European governments have been willing to contemplate so far, as fractious parties in Athens prepared to vote on a sweeping austerity package demanded by their lenders. ID:nL5N0ZU0MC

* ICE Benchmark Administration said it would scrap a market convention dating back to 1919 that adds a "seller's premium" to its gold benchmark price for settlement purposes from January 2016. ID:nL5N0ZU43W

* South Africa's Association of Mineworkers and Construction Union will return to wage talks with gold producers after walking out last week, its chief negotiator said. ID:nL5N0ZU1O4

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

MARKET NEWS

* Asian stocks inched higher, taking their cue from Wall Street ahead of key events including Chinese economic data, a Bank of Japan policy decision and Yellen's congressional testimony. MKTS/GLOB

* Sterling was broadly higher after the Bank of England put the prospect of an interest rate hike front and centre. USD/

DATA/EVENTS AHEAD(GMT)

0200 China

Gross domestic product

Q2

0200 China

Industrial output

June

0200 China

Retail sales

June

0200 China

Urban investment

June

1230 U.S.

New York Fed manufacturing

July

1315 U.S.

Industrial output

June

1400 Federal Reserve Chair Janet Yellen delivers

seminannual testimony on monetary policy before the

House Financial Services Committee

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