PRECIOUS-Gold steadies after 3-day rise following ECB comments

Published 2016-10-20, 10:15 a/m
© Reuters. PRECIOUS-Gold steadies after 3-day rise following ECB comments
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* ECB leaves rates unchanged, maintains stimulus

* Gold closes back above 200-day moving average

* GRAPHIC-2016 asset returns: http://reut.rs/1WAiOSC (Updates prices, adds comment)

By Jan Harvey

LONDON, Oct 20 (Reuters) - Gold steadied on Thursday after three days of gains as the European Central Bank left interest rates unchanged and maintained the parameters of its 1.74 trillion euro ($1.95 trillion) asset buying scheme.

The ECB has provided extraordinary stimulus in recent years in response to high unemployment, weak growth and ultra low inflation, cutting interest rates into negative territory and pushing the cost of credit to all-time lows. rates tend to support gold, though that is often offset by the impact of a weaker euro. The single currency fell 0.3 percent against the dollar on Thursday.

Spot gold XAU= was at $1,268.98 an ounce at 1407 GMT, little changed from late on Wednesday, having earlier risen as hgh as $1,273.81. U.S. December gold futures GCv1 were up 30 cents at $1,270.20.

The precious metal has regained some technical momentum after closing on Wednesday above its 200-day moving average of $1,267.

Gold saw good buying at the time of the ECB release, Mitsubishi analyst Jonathan Butler said. "(The) ECB will continue to have a very accommodative policy at least until December," he said.

U.S. Treasury prices rose as ECB chief Mario Draghi said there was no discussion at the bank's latest policy meeting on possible changes to its 1 trillion-plus euro bond purchase program. US/

The euro EUR= edged lower, but stocks rose after the third and final U.S. presidential debate, which was judged not to have improved Donald Trump's election hopes. MKTS/GLOB

That could also weigh on gold. A win for Democrat Hillary Clinton is now clearly predicted by polls, and is seen as easing the way for a rise in interest rates, heavily tipped by a number of Federal Reserve policymakers for December. FRX/

India's overseas purchases of gold likely hit a nine-month high in October as a flip in domestic prices to a premium prompted banks and refiners to resume imports ahead of the festival season, industry officials told Reuters. gold exports to China hit their highest since January last month, Swiss customs data showed on Thursday, though a sharp drop in shipments to Hong Kong meant exports to the two combined were sharply lower than a year earlier. more gold was shipped directly to China," Commerzbank (DE:CBKG) said in a note. "What is more, Swiss gold exports to India climbed to their highest level since January, which points to demand recovering there."

Silver XAG= was down 0.3 percent at $17.59 an ounce, while platinum XPT= was down 1 percent at $935 an ounce and palladium XPD= was 1 percent lower at $629.50 an ounce.

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http://reut.rs/1WAiOSC

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