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PRECIOUS-Gold prices snap 4-day losing streak; focus on ECB meet

Published 2019-09-11, 03:43 a/m
© Reuters.  PRECIOUS-Gold prices snap 4-day losing streak; focus on ECB meet
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* Spot gold still targets $1,453/oz - technicals

* Dollar steady as traders await Thursday's ECB meeting (Updates prices)

By Eileen Soreng

Sept 11 (Reuters) - Gold prices edged up on Wednesday, snapping a four-day losing streak on technical buying, amid expectations that the European Central Bank will dole out stimulus and cut interest rates.

Spot gold XAU= was up 0.3% at $1,490.27 per ounce, as of 0732 GMT. In the previous session, prices fell to their lowest since Aug. 13 at $1,483.90.

U.S. gold futures GCv1 were up 0.2% at $1,502.2 an ounce.

"The ECB is expected to reduce further the interest rate into negative territory... The meeting could serve as a potential catalyst (for gold) and investors are already buying into the rate cut expectations," said Margaret Yang Yan, a market analyst at CMC Markets.

Given that gold has had such a deep correction from its recent peak, investors are buying on dips, Yan added.

Bullion prices have shed more than 4%, or over $60, since scaling an over six-year peak of $1,557 on Sept. 4.

Risk sentiment got a lift ahead of monetary policy decisions by the ECB on Thursday and the U.S. Federal Reserve next week, with investors hoping for further easing amid a slowdown in global growth.

Market participants might be reluctant to commit to big risk-on bets, which could nudge gold upwards amid pre-positioning ahead of Thursday's event, said Ilya Spivak, senior currency strategist, DailyFx.

ECB policymakers are leaning toward a package that includes a rate cut, a pledge to keep rates low for longer and compensation for banks over the side-effects of negative rates, five sources familiar with the discussion said last week. backdrop is still broadly gold-supportive considering the main sources of risk aversion remain unresolved, Spivak added.

"Both Brexit and the U.S.-China trade war are ongoing concerns, as is the broader slowdown in global growth ... That probably encourages central banks to remain dovish."

Gold prices gained about 18%, or over $200, since hitting year's low of $1,265.85 on May 2.

On the trade front, a senior White House adviser tamped down expectations on Tuesday for the next rounds of U.S.-China trade talks, urging investors, businesses and the public to be patient about resolving the trade dispute. gold still targets $1,453, as it has cleared a support at $1,497 per ounce, according to Reuters technical analyst Wang Tao. the dollar index was steady .DXY , while Asian stock markets held firm and bond yields rose on Wednesday. USD/ MKTS/GLOB

Among other precious metals, silver XAG= rose 0.5% to $18.09 per ounce, having hit a two-week low of $17.75 in the previous session.

Palladium XPD= was trading flat at $1,560.96 per ounce, while platinum XPT= gained 0.7% to $936.90.

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