MANILA, Feb 4 (Reuters) - Gold stayed near a three-month top
on Thursday after marking its best day in two weeks as the U.S.
dollar slid after investors scaled back expectations for a
near-term U.S. interest rate increase.
FUNDAMENTALS
* Spot gold XAU= was little changed at $1,141.01 an ounce
by 0040 GMT, after rising as high as $1,145.60 on Wednesday, its
loftiest since Oct. 30. Gold rallied 1.2 percent overnight, the
biggest single-day gain since Jan. 20.
* U.S. gold for April delivery GCcv1 was flat at $1,141.90
an ounce.
* Financial conditions have tightened considerably in the
weeks since the Federal Reserve raised rates and monetary policy
makers will have to take that into consideration should that
phenomenon persist, William Dudley, president of the Federal
Reserve Bank of New York, told MNI in an interview.
* Those comments dragged down the dollar overnight, adding
to market expectations that the Fed is unlikely to raise rates
again in March. U.S. rates rose for the first time in nearly a
decade in December.
* Also cooling U.S. rate hike views, activity in the U.S.
services sector slowed to a near two-year low in January,
suggesting that economic growth weakened further at the start of
the first quarter even as the labor market remains resilient.
* The weaker dollar plus hopes that U.S. rates would remain
unchanged next month boosted gold, which has risen nearly 8
percent this year. Volatility in other assets also burnished
gold's appeal.
* Holdings of top gold-backed exchange-traded fund, SPDR
Gold Trust GLD , continued to rise, standing at 22.19 million
ounces on Wednesday, the highest since late October.
* For the top stories on metals and other news, click
TOP/MTL or GOL
MARKET NEWS
* Asian shares rebounded as speculation the Federal Reserve
might opt to not raise interest rates at all this year hammered
the dollar and sparked a huge rally in oil prices. MKTS/GLOB
* The dollar nursed hefty losses against the yen and euro
after tumbling overnight when Dudley tempered expectations on
the pace of future U.S. interest rate increases. USD/
DATA AHEAD (GMT)
1330 U.S. Weekly jobless claims
1500 U.S. Factory orders Dec