SINGAPORE, Oct 26 (Reuters) - Gold was hovering close to its
lowest in nearly two weeks on Monday, hurt by a stronger dollar
and fears the Federal Reserve could raise U.S. interest rates
this year.
FUNDAMENTALS
* Spot gold XAU= eased 0.1 percent to $1,162.25 an ounce
by 0035 GMT.
* On Friday, the metal had initially risen 1 percent after
China cut interest rates for the sixth time in less than a year.
urn:newsml:reuters.com:*:nL3N12N405
* But gold quickly gave back those gains, dropping to
$1,158.77, its lowest since Oct. 13, as the dollar rose to its
highest in 2-1/2 months on diverging monetary policies between
the Federal Reserve and some of the other major central banks.
* The Fed is close to raising rates for the first time in
nearly a decade, though the exact timing is unclear.
* Investors initially bet the U.S. central bank would be
compelled to delay raising rates given the fragility of the
global economy, but buying soon evaporated on the view that the
Chinese stimulus and upbeat U.S. data made a Fed rate hike more
likely this year.
* Higher rates could dent the appeal of
non-interest-yielding bullion.
* The Fed holds a policy meeting later this week. Though it
is not expected to hike rates at this week's meeting, investors
will be watching for clues on the Fed's take on the global
economy and whether the central bank would raise rates at its
December meeting.
* SPDR Gold Trust, the world's largest gold-backed
exchange-traded fund, said its holdings fell 0.26 percent to
695.54 tonnes on Friday.
* Hedge funds and money managers raised their bullish bets
in COMEX gold and silver in the week to Oct. 20, Commodity
Futures Trading Commission data showed on Friday. urn:newsml:reuters.com:*:nL1N12N23S
* A programme to attract gold owned by households into a
bank deposit scheme to monetise the precious metal could be
ready in weeks, Prime Minister Narendra Modi said on Sunday, a
step aimed at cutting expensive imports. urn:newsml:reuters.com:*:nL3N12P054
* For the top stories on metals and other news, click
TOP/MTL or GOL
MARKET NEWS
* Stock markets worldwide soared on Friday after China cut
interest rates for the fourth time this year and several
large-cap U.S. technology companies reported
better-than-expected quarterly results. MKTS/GLOB
DATA AHEAD (GMT)
0900 Germany Ifo business climate Oct
1400 U.S. New home sales Sep
PRICES AT 0035 GMT
Metal Last Change Pct chg
Spot gold 1162.25 -1.61 -0.14
Spot silver 15.8 0 0
Spot platinum 996.74 -2.26 -0.23
Spot palladium 689.75 2.25 0.33
Comex gold 1162.4 -0.4 -0.03
Comex silver 15.81 -0.017 -0.11
COMEX gold and silver contracts show the
most active months