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PRECIOUS-Gold dips for first time in three sessions on Fed's Yellen remarks

Published 2016-12-19, 08:09 p/m
© Reuters. PRECIOUS-Gold dips for first time in three sessions on Fed's Yellen remarks
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Dec 20 (Reuters) - Gold prices edged lower on Tuesday, after closing up in the two previous sessions, as optimistic remarks on the U.S. labor market by Federal Reserve Chair Janet Yellen strengthened the possibility of further rate hikes next year.

FUNDAMENTALS

* Spot gold XAU= shed 0.2 percent to $1,136.96 an ounce by 0100 GMT.

* U.S. gold futures GCcv1 fell 0.3 percent to $1,139.10 per ounce.

* Federal Reserve Chair Janet Yellen said on Monday the U.S. labor market has improved to its strongest in nearly a decade, suggesting wage growth is picking up and underscoring expectations the central bank will continue to raise interest rates next year. The Bank of Japan is likely to keep monetary policy steady and give a more upbeat view of the economy on Tuesday, reinforcing market expectations that its future policy direction could be an increase - not a cut - in interest rates. China's economic growth is expected to cool in 2017 as its top leaders flag tighter monetary policy and further curbs to clamp down on asset price bubbles, especially in the property market, even as a sharp drop in the yuan has fed fears of market turmoil. Holdings of the SPDR Gold Trust GLD , the world's largest gold-backed exchange-traded fund, fell 1.06 percent to 828.10 tonnes on Monday. GOL/ETF

* Macquarie cuts gold and silver price forecasts for 2017. Macquarie sees average 2017 gold price forecast at $1,216 an ounce (down 11.9 percent from previous forecast), sees 2018 gold outlook at $1,375 an ounce. Singapore Exchange Ltd SGXL.SI announced that its Singapore kilobar gold contract has become the world's first Shariah-compliant gold futures For the top stories on metals and other news, click TOP/MTL or GOL

DATA AHEAD (GMT)

0700 Germany

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