(Updates prices)
By A. Ananthalakshmi
SINGAPORE, Oct 23 (Reuters) - Gold edged higher from its
lowest in over a week on Friday as the dollar gave back some of
its overnight gains, but the metal was poised to snap two
straight weekly gains on a boost to expectations for a U.S. rate
rise this year.
Spot gold XAU= rose 0.6 percent to $1,173.16 an ounce by
0702 GMT. It fell as low as $1,162.50 in the previous session,
the lowest level since Oct. 13.
For the week, the metal is down 0.3 percent, after posting
two straight weekly gains. U.S. gold futures GCcv1 eased about
1 percent for the week, the biggest loss in six weeks.
The dollar climbed to its highest in nearly a month on
Thursday against a basket of major currencies, but dropped 0.1
percent on Friday.
Upbeat U.S. housing and labour market data, and stronger
equity markets, however, capped gains in gold.
"The general expectation is for the Fed to raise rates next
year, but in recent days we have seen some robust data from the
U.S. and cannot completely rule out a December rate hike," said
a trader in Hong Kong.
Some long positions have been liquidated since the metal
failed to hold above $1,190 an ounce, he said.
Bullion has been hurt by uncertainty over the timing of the
first U.S. rate hike in nearly a decade. Investors believe
higher rates could hurt demand for non-interest-paying gold.
Rate rise expectations have largely been pushed out to next
year over concerns about the health of the global economy, but
recent U.S. data has been strong.
U.S. home resales rebounded strongly in September and new
applications for unemployment benefits hovered around 42-year
lows last week, data on Thursday showed. urn:newsml:reuters.com:*:nL1N12M15S
Bullion wasn't seeing much support from the physical
markets. Festive demand for gold in India, the second biggest
consumer, got off to a tepid start, with local prices heavily
discounted to the global benchmark. urn:newsml:reuters.com:*:nL3N12M31R
Demand in top consumer China was also lacklustre, dealers
said, while premiums in Hong Kong dropped.
PRICES AT 0702 GMT
Metal Last Change Pct chg
Spot gold 1173.16 7.51 0.64
Spot silver 16 0.19 1.2
Spot platinum 1012.5 6.75 0.67
Spot palladium 686.75 3.75 0.55
Comex gold 1173.3 7.2 0.62
Comex silver 16 0.163 1.03
COMEX gold and silver contracts show the
most active months