SINGAPORE, April 12 (Reuters) - Gold jumped to a three-week
peak on Tuesday on expectations the Federal Reserve will not
raise U.S. interest rates soon and as the dollar traded close to
its lowest in nearly eight months.
FUNDAMENTALS
* Spot gold XAU= rose to $1,259.66 an ounce early on
Tuesday, its highest since March 18. However, it pared gains to
trade down 0.2 percent at $1,254.70 an ounce by 0036 GMT, on
profit-taking following a 1.4-percent overnight gain.
* U.S. gold futures GCcv1 also climbed to a three-week top
of $1,261.90.
* The dollar on Monday slumped to its lowest since August
against a basket of major currencies and a 17-month low against
the Japanese yen.
* A softer greenback bolsters demand for dollar-denominated
currencies.
* The U.S. currency has been on the back foot since Fed
Chair Janet Yellen last month doused expectations for hikes in
U.S. interest rates anytime soon.
* Scaled-back expectations for further monetary tightening
this year helped gold to its best quarter in nearly 30 years in
the three months to March, after the U.S. central bank raised
rates in December for the first time in nearly a decade.
* Gold has also been buoyed by safe-haven demand.
* Weak economic data and uncertainty over U.S. monetary
policy has contributed to risk aversion, boosting investor
appetite for bullion and other assets perceived as safer stores
of value, including the Japanese yen.
* Asian stocks made a subdued start on Tuesday, with
Japanese shares dipping on a bullish yen.
* In the physical markets, more than half of Indian
jewellers reopened their shops on Monday after keeping them
closed for nearly six weeks in protest over the reintroduction
of excise duty on gold jewellery.
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TOP/MTL or GOL
DATA AHEAD (GMT)
0600 Germany Wholesale price index Mar
0830 Britain Consumer prices Mar
1000 U.S. NFIB business optimism Mar
1230 U.S. Import prices Mar
1230 U.S. Export prices Mar
1800 U.S. Federal budget Mar
PRICES AT 0036 GMT
Metal Last Change Pct chg
Spot gold 1254.7 -2.85 -0.23
Spot silver 15.846 -0.054 -0.34
Spot platinum 986.87 -1.13 -0.11
Spot palladium 545.8 0.8 0.15
Comex gold 1256.9 -1.1 -0.09
Comex silver 15.865 -0.111 -0.69
COMEX gold and silver contracts show the
most active months