* Oil prices resume slide, down more than 1 percent
* Dollar index climbs to near 1-week high
* Gold set to drop nearly 10 pct for the year
By A. Ananthalakshmi
SINGAPORE, Dec 30 (Reuters) - Gold was little changed on
Wednesday as thin liquidity and a firmer dollar capped price
moves, although the metal remained on track to close the year
lower for a third time in a row.
The precious metal has lost nearly 10 percent of its value
this year, largely on fears that higher U.S. interest rates
would hurt demand for non-interest-paying bullion.
Spot gold XAU= was steady at $1,069.40 an ounce by 0109
GMT, following a flat close overnight.
Limited trading volume and market-moving data in the
holiday-shortened week will keep things quiet, though gold could
take cues from the oil and currency markets, traders said.
Gold is positively co-related to oil as the metal is often
seen as a hedge against oil-led inflation, while a stronger
greenback makes dollar-denominated gold more expensive for
holders of other currencies.
Oil prices fell more than 1 percent early on Wednesday after
jumping 3 percent in the previous session. O/R
In the currency market, the dollar rose to nearly a one-week
high against a basket of six currencies .DXY on Tuesday from a
near two-week low hit earlier in the session. It continued to
climb on Wednesday. USD/
The dollar is expected to stay firm following the U.S.
Federal Reserve's move to hike rates for the first time in
nearly a decade this month and indications the central bank
would resort to gradual increases in 2016.
The outlook for gold does not look very bullish heading into
the next year, with several traders and brokerages predicting a
drop in prices to $1,000 or below early in 2016.
Assets of SPDR Gold Trust GLD , the top gold-backed
exchange-traded fund, are near a seven-year low, while short
positions on COMEX gold contracts are close to an all-time high.
PRICES AT 0109 GMT
Metal Last Change Pct chg
Spot gold 1069.4 0.79 0.07
Spot silver 13.975 0.025 0.18
Spot platinum 890 5.26 0.59
Spot palladium 554.55 -0.48 -0.09
Comex gold 1069.2 1.2 0.11
Comex silver 13.96 0.032 0.23
COMEX gold and silver contracts show the
most active months