* Gold gains for second day as dollar dips
* Geopolitical tensions trigger safe-haven bids
* Coming up: U.S. Weekly jobless claims, New home sales Oct
(Updates prices)
By A. Ananthalakshmi
SINGAPORE, Nov 25 (Reuters) - Gold added to overnight gains
on Wednesday on a softer dollar and heightened tensions after
Turkey shot down a Russian warplane, but the rally was capped on
expectations of a U.S. rate hike next month.
Turkey shot down the Russian jet near the Syrian border on
Tuesday, saying the plane had violated its air space, in one of
the most serious publicly acknowledged clashes between a NATO
member country and Russia for half a century.
U.S. President Barack Obama and French President Francois
Hollande, meeting in Washington, urged against an escalation,
while NATO Secretary-General Jens Stoltenberg said the military
alliance stood in solidarity with Turkey.
The tensions triggered a sell-off in equities and the
dollar, while boosting the safe-haven yen, gold and government
debt. MKTS/GLOB
Spot gold XAU= edged up 0.3 percent to $1,078.61 an ounce
by 0645 GMT, following a 0.6 percent gain on Tuesday. U.S. gold
GCcv1 rose 0.5 percent, after a near 1 percent gain in the
previous session.
"Gold rose on flight-to-quality as investors sought
protection from volatile financial markets in the wake of global
stresses," said HSBC analyst James Steel.
"While we think gold may be supported, we are not
anticipating a robust rally, and look for only moderate gains,
with a lot of upside resistance," he said.
Despite the gains, gold wasn't too far from a near-six-year
low of $1,064.95 hit last week on increasing views that the
Federal Reserve will hike U.S. rates next month for the first
time in nearly a decade.
Gold tends to benefit from ultra-low U.S. rates, which lower
the opportunity cost of holding non-yielding bullion.
Data on Tuesday supported views of a December rate hike.
The U.S. economy grew at a healthier clip in the third quarter
than initially thought.
Traders will be eyeing more U.S. data due later on
Wednesday, including weekly jobless claims and October new home
sales, to gauge the strength of the economy.
Liquidity, however, could be thin ahead of the U.S.
Thanksgiving holiday on Thursday.
Among other precious metals, silver XAG= rose for a second
session after dipping to a six-year low of $13.86 earlier this
week, while platinum XPT= was trading just above a seven-year
low.
Palladium XPD= rose nearly 1 percent to $540.65.
PRICES AT 0645 GMT
Metal Last Change Pct chg
Spot gold 1078.61 3.5 0.33
Spot silver 14.22 0.02 0.14
Spot platinum 844.85 4.85 0.58
Spot palladium 540.65 4.93 0.92
Comex gold 1078.6 4.8 0.45
Comex silver 14.17 0.011 0.08
COMEX gold and silver contracts show the
most active months
* Geopolitical tensions trigger safe-haven bids
* Coming up: U.S. Weekly jobless claims, New home sales Oct
(Updates prices)
By A. Ananthalakshmi
SINGAPORE, Nov 25 (Reuters) - Gold added to overnight gains
on Wednesday on a softer dollar and heightened tensions after
Turkey shot down a Russian warplane, but the rally was capped on
expectations of a U.S. rate hike next month.
Turkey shot down the Russian jet near the Syrian border on
Tuesday, saying the plane had violated its air space, in one of
the most serious publicly acknowledged clashes between a NATO
member country and Russia for half a century.
U.S. President Barack Obama and French President Francois
Hollande, meeting in Washington, urged against an escalation,
while NATO Secretary-General Jens Stoltenberg said the military
alliance stood in solidarity with Turkey.
The tensions triggered a sell-off in equities and the
dollar, while boosting the safe-haven yen, gold and government
debt. MKTS/GLOB
Spot gold XAU= edged up 0.3 percent to $1,078.61 an ounce
by 0645 GMT, following a 0.6 percent gain on Tuesday. U.S. gold
GCcv1 rose 0.5 percent, after a near 1 percent gain in the
previous session.
"Gold rose on flight-to-quality as investors sought
protection from volatile financial markets in the wake of global
stresses," said HSBC analyst James Steel.
"While we think gold may be supported, we are not
anticipating a robust rally, and look for only moderate gains,
with a lot of upside resistance," he said.
Despite the gains, gold wasn't too far from a near-six-year
low of $1,064.95 hit last week on increasing views that the
Federal Reserve will hike U.S. rates next month for the first
time in nearly a decade.
Gold tends to benefit from ultra-low U.S. rates, which lower
the opportunity cost of holding non-yielding bullion.
Data on Tuesday supported views of a December rate hike.
The U.S. economy grew at a healthier clip in the third quarter
than initially thought.
Traders will be eyeing more U.S. data due later on
Wednesday, including weekly jobless claims and October new home
sales, to gauge the strength of the economy.
Liquidity, however, could be thin ahead of the U.S.
Thanksgiving holiday on Thursday.
Among other precious metals, silver XAG= rose for a second
session after dipping to a six-year low of $13.86 earlier this
week, while platinum XPT= was trading just above a seven-year
low.
Palladium XPD= rose nearly 1 percent to $540.65.
PRICES AT 0645 GMT
Metal Last Change Pct chg
Spot gold 1078.61 3.5 0.33
Spot silver 14.22 0.02 0.14
Spot platinum 844.85 4.85 0.58
Spot palladium 540.65 4.93 0.92
Comex gold 1078.6 4.8 0.45
Comex silver 14.17 0.011 0.08
COMEX gold and silver contracts show the
most active months