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PRECIOUS-Gold holds on to overnight losses; central bank policies in focus

BENGALURU, July 19 (Reuters) - Gold on Tuesday held on to
its losses from the previous session, when it fell about 0.7
percent, as risk averse sentiment cooled expectations of easing
monetary policies across the globe.
    
    FUNDAMENTALS
    * Spot gold remained nearly flat at $1,328.70 an
ounce at 0057 GMT. It closed at $1,328.39 on Monday.
    * U.S. gold was unchanged at $1,329.40 an ounce.
    * Asian shares edged slightly lower in early Asian trade on
Tuesday, as a downturn in crude oil curbed the enthusiasm from
fresh record highs on Wall Street. 
    * Britain's shock vote to leave the European Union has led
analysts to raise their gold price forecasts again this year,
after the decision shook up financial markets and sparked a
rally in the precious metal to two-year high. 
    * Holdings in SPDR Gold Trust, the world's largest
gold-backed exchange-traded fund, rose 0.25 percent to 965.22
tonnes on Monday. 
    * Foreigners sold U.S. Treasury bonds and notes for a second
straight month in May, data from the U.S. Treasury department
showed on Monday, as investors believed that the Federal Reserve
would raise interest rates more than once this year.
    * Bank of England policymaker Martin Weale said on Monday he
was unsure whether he would back an interest rate cut at next
month's BoE meeting, in contrast to most of his colleagues who
think stimulus is likely after Britain voted to leave the EU.
 
    * The European Central Bank meets later this week against a
backdrop of sharply lower government bond yields that raising
pressure on the ECB to address a scarcity of bonds for its 1.7
trillion euro stimulus programme. 
    * Just as mortgage bankers were preparing for the end of a
historic boom driven by low interest rates, borrowers have begun
knocking at their doors again. 
    * The loss of correspondent banking relationships in
developing countries as major banks try to limit risk exposures
could marginalise small economies and cause "systemic"
disruptions to their financial systems, the head of the
International Monetary Fund said on Monday. 
    * The U.S. Mint ended its weekly rationing of American Eagle
silver bullion coins, a spokesman said on Monday, a year after
introducing the allocation due to shortages of blanks as sales
eased. 
    

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    Data ahead (GMT) 
         0900 Germany ZEW Economic Sentiment  for July 
         1230 US Building permits, housing starts for June
         1255 U.S. Redbook weekly

 (Reporting By Nallur Sethuraman in Bengaluru)
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