PRECIOUS-Gold edges up on U.S. budget gridlock, debt ceiling fears

Tue Oct 8, 2013 8:30pm EDT

SINGAPORE, Oct 9 (Reuters) - Gold ticked higher on Wednesday
as the U.S. budget impasse dragged on for a second week and
threatened to spill over to talks about raising the U.S. debt
ceiling, boosting the metal's safe-haven appeal.

    FUNDAMENTALS
    * Spot gold rose 0.2 percent to $1,320.44 an ounce by
0019 GMT. 
    * President Barack Obama refused to give ground in a fiscal
confrontation with Republicans on Tuesday, saying he would
negotiate on budget issues only if they agree to re-open the
federal government and raise the debt limit with no conditions.
 
    * Congress faces an Oct. 17 deadline to raise the $16.7
trillion borrowing limit in order to avert the risk of a default
on U.S. debt.
    * Obama will announce his intent to nominate Federal Reserve
Vice Chairwoman Janet Yellen to be the next head of the U.S.
central bank on Wednesday, a White House official said.
 
    * Indian silver imports are on pace to hit a record high
this year as the wedding and festival season drives up buying of
the precious metal instead of traditional gold, made scarcer and
dearer by official measures aimed at cutting the trade gap.
 
    * India's gold demand could rise as much as 15 percent this
quarter to 300 tonnes as pent-up demand following a good monsoon
keeps the country on track for yearly demand estimated at 1,000
tonnes. 
    * SPDR Gold Trust, the world's largest gold-backed
exchange-traded fund, said its holdings fell 0.2 percent, or
1.81 tonnes, to 898.18 tonnes on Tuesday. 
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    MARKET NEWS
    * The U.S. dollar languished near a two-month low against
the yen in Asia on Wednesday and stayed close to a recent
eight-month trough on a currency basket, with investors growing
anxious as the U.S. budget impasse drags on. 
    
    DATA/EVENTS (GMT) 
    0830 UK August Manufacturing, Industrial Output 
    1000 German August Industrial Output 
    1100 U.S. Weekly Mortgage Market Index 
    2350 Japan August Machinery Orders 
    N/A  BOE Holds Policy Meeting     

  Precious metals prices 0019 GMT
  Metal             Last    Change  Pct chg  YTD pct chg    Volume
  Spot Gold        1320.44    2.14   +0.16    -21.15
  Spot Silver        22.35    0.10   +0.45    -26.19
  Spot Platinum    1398.99    3.39   +0.24     -8.86
  Spot Palladium    711.00   -1.00   -0.14      2.75
  COMEX GOLD DEC3  1321.20   -3.40   -0.26    -21.16         3897
  COMEX SILVER DEC3  22.40   -0.05   -0.21    -26.10          528
  Euro/Dollar       1.3592
  Dollar/Yen         96.96
 
  COMEX gold and silver contracts show the most active months
 
 (Reporting by A. Ananthalakshmi; Editing by Richard Pullin)