PRECIOUS-Gold steady on weaker dollar as U.S. rate hike prospects lose steam

Published 2016-08-02, 03:04 a/m
© Reuters.  PRECIOUS-Gold steady on weaker dollar as U.S. rate hike prospects lose steam
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* Gold biased to break support at $1,346 - technicals

* Platinum hits fresh 14-month high

* SPDR Gold holdings rise 0.6 pct on Monday (Updates prices)

By Sethuraman N R

Aug 2 (Reuters) - Gold held steady on Tuesday as the dollar hovered near a three-week low after expectations of a near-term U.S. interest rate hike lost steam following last week's disappointing U.S. growth figures.

The dollar index, which measures the greenback against a basket of six major currencies .DXY , fell 0.1 percent at 95.61. It touched a low of 95.38 last week when it posted its biggest fall in three months.

Spot gold XAU= was flat at $1,352.16 an ounce at 0633 GMT, after closing up 0.2 percent at $1,352.85 on Monday.

U.S. gold GCcv1 was mostly unchanged at $1,358.8 an ounce.

"Gold continues to trade with a bid tone and we see $1,345 - $1,350 as broadly supportive over the short-term as the metal looks for a break higher towards $1,375," said MKS PAMP Group trader Sam Laughlin.

Spot gold is biased to break a support at $1,346 per ounce and fall towards the next support at $1,328, as indicated by its wave pattern and a Fibonacci retracement analysis, Reuters technical analyst Wang Tao said. prices edged up in early trading on Tuesday after U.S. crude broke below $40 per barrel the previous session, but traders said fuel markets continued to be dogged by excess production. O/R

"So far, oil weakness has not had much of an impact (on gold), telling us that investors are more encouraged by the lack of any imminent Fed rate increase," INTL FCStone analyst Edward Meir said in a note.

The Federal Reserve should be cautious on interest rate increases due to lingering risks to the U.S. economy, New York Fed President William Dudley said on Monday, appearing to signal the chance of a hike by the end of the year was fading. Bank of England looks ready to cut interest rates for the first time since 2009 on Thursday, seeking to stop Britain's vote to leave the European Union from kicking the country into recession. of SPDR Gold Trust GLD , the world's largest gold-backed exchange-traded fund, rose 0.62 percent to 964.03 tonnes on Monday. GOL/ETF

Among other precious metals, platinum XPT= rose 0.3 percent at $1,160.85 an ounce on Tuesday, after touching a more than 14-month high of $1,163 during the session.

Palladium XPD= climbed 0.6 percent at $717.20 on Tuesday, after hitting a 13-month high of $722.70 an ounce in the previous session.

Silver XAG= was up slightly at $20.44.

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