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PRECIOUS-Gold steady as U.S. rate hike expectations cool

Aug 2 - Gold was little changed early Tuesday, hovering near
a three-week high hit on Friday as expectations of a near-term
U.S. interest rate hike eased following disappointing U.S.
growth figures.

    FUNDAMENTALS
    * Spot gold was unchanged at $1,352.93 an ounce at
0103 GMT. Bullion ended up 0.2 percent at $1,352.85 on Monday.
The yellow metal hit a high of $1,355.10 on Friday, its highest
level since July 12. 
    * U.S. gold was flat at $1,359.8 an ounce.
    * The Federal Reserve should be cautious on interest rate
increases due to lingering risks to the U.S. economy, New York
Fed President William Dudley said on Monday, appearing to signal
the chance of a hike by the end of the year was fading.
 
    * The Bank of England looks ready to cut interest rates for
the first time since 2009 on Thursday, seeking to stop Britain's
vote to leave the European Union from kicking the country into
recession. 
    * U.S. manufacturing activity eased in July amid shrinking
order backlogs and declining employment, while an unexpected
drop in construction spending in June suggested second-quarter
economic was probably even weaker than reported last week.
 
    * British manufacturers slammed on the brakes last month
after the Brexit vote and growth eased in the euro zone, surveys
indicated, with factories in China, Japan and elsewhere in Asia
offering only crumbs of comfort.
    * India's gold imports fell for a sixth straight month in
July as sluggish demand and record high discounts prompted banks
and refineries to reduce overseas purchases of bullion,
provisional data from consultancy GFMS showed on Monday.
 
    *  Holdings of SPDR Gold Trust, the world's largest
gold-backed exchange-traded fund, rose 0.62 percent to 964.03
tonnes on Monday. 
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    MARKET REPORT
    * U.S. crude tumbled below $40 per barrel on Monday for the
first time since April, as oil prices settled down nearly 4
percent on heightened worries of a crude glut despite peak
summer fuel demand. 
    * Asian shares edged lower in early trading on Tuesday,
taking their cues from a modestly lower day on Wall Street as
U.S. crude oil prices slid. 
    
    
    DATA AHEAD (GMT)
    0900 Euro zone Producer prices June 
    1230 U.S. Personal income June 
    1345 U.S. ISM-New York index July

 (Reporting By Nallur Sethuraman in Bengaluru; Editing by
Richard Pullin)
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