PRECIOUS-Gold near two-week low as Britain votes on EU membership

Published 2016-06-23, 06:21 a/m
© Reuters.  PRECIOUS-Gold near two-week low as Britain votes on EU membership
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* Gold slips as final polls point to Britain staying in EU
* Pound marks six-month high against the dollar
* Britons begin voting in referendum, results due Friday

(Updates throughout, changes dateline from BENGALURU)
By Clara Denina
LONDON, June 23 (Reuters) - Gold fell to a two-week low on
Thursday after the last sweep of opinion polls before Britain's
referendum on EU membership began gave the campaign to stay in
the bloc a slight edge.
Britons were voting on Thursday in the referendum that has
divided the nation. The polling will close at 2100 GMT, with
results expected early on Friday.
Spot gold XAU= was down 0.1 percent at $1,265.30 an ounce
by 1003 GMT, after hitting $1,260.36, its lowest since June 9.
The metal, often perceived as a hedge against economic and
financial uncertainty, reached a near two-year high on June 16,
as wider markets reacted to mounting concerns over the prospect
of Britain pulling out of the EU and sought protection in 'safe'
assets. They also included German bunds, the Swiss franc and
Japan's yen, but the rally was short-lived.
"The fear we had mid last week about Britain leaving the EU
appears to be waning and that's also why gold has retreated,"
Julius Baer analyst Carsten Menke said.
"In case of a "Leave" win, any rise in gold would not be
long lasting because this would not result in a deep economic or
financial crisis," Menke said, adding that a "Remain" vote would
see prices fall towards the $1,200 mark.
Polls by ComRes, conducted for the Daily Mail newspaper and
ITV (LON:ITV) television, and by YouGov for The Times newspaper in London,
showed a last-minute rise in support for Britain to remain in
the EU.
In wider markets, sterling hit a 2016 high against the
dollar and world stocks climbed for a fifth day running.
MKTS/GLOB
Investors piled on near-term bullish and bearish options
bets on Wednesday, racing to protect against price swings during
Britain's vote, data showed.
"Once the effects of the referendum results pass, we would
expect that gold will eventually focus back on other price
drivers and fundamentals. There is a good argument that in the
near term gold may be overbought," HSBC said in a note.
Holdings in the SPDR Gold Trust GLD , the world's largest
gold-backed exchange-traded fund, rose 0.39 percent to 915.90
tonnes on Wednesday, the highest since September 2013. GOL/ETF
Among other precious metals, silver XAG= rose 1 percent to
$17.39 and platinum XPT= was up 0.1 percent at $973.60.
Palladium fell 0.1 percent to $560.54 an ounce.

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