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PRECIOUS-Gold hits 3-week low as equities rise; ECB in focus

BENGALURU, July 21 (Reuters) - Gold hit a three-week low on
Thursday, after falling more than 1 percent in the previous
session, as equities rose and with investors eyeing a European
Central Bank meeting later in the day amid rising expectations
rise for a U.S. interest rate hike.
     
    FUNDAMENTALS
    * Spot gold fell 0.3 percent at $1,311.83 an ounce at
0057 GMT. Bullion fell 1.2 percent on Wednesday.
    * U.S. gold was down 0.6 percent at $1,311.70 an
ounce.
    * Asian shares edged up on Thursday, bolstered by fresh
record highs on Wall Street and a recovery in oil prices, while
the dollar climbed to a six-week peak against the safe-haven
yen.  
    * Gold has risen over 25 percent this year, hitting its
highest since March 2014 at $1,374.91 earlier this month. 
    * The European Central Bank is all but certain to keep rates
firmly on hold on Thursday but will have to address an ever
growing list of obstacles that threaten once again to derail its
efforts to revive growth and inflation. 
    The bank will announce its rate decision at 1145 GMT and ECB
chief Mario Draghi will hold a news conference at 1230 GMT.
 
    * Investors betting the Bank of Japan will ease monetary
policy next week could be riding for a fall, as the yen's recent
weakening and a government spending package take some pressure
off the bank to step up its massive stimulus programme.
    * The Russian central bank increased its gold reserves to
48.2 million troy ounces as of July 1 from 47.6 million ounces
one month earlier, the bank said on Wednesday. 
    * Newmont Mining's adjusted net income in the second
quarter blew past market expectations on Wednesday and the
world's second-biggest gold miner by value also cut its gold
cost forecast 
    * Canadian mining company Agnico Eagle said on
Wednesday that a group of armed men stormed one of its mines in
northern Mexico early on Tuesday morning, injuring a security
guard and making off with a haul of silver and gold.
    * For the top stories on metals and other news, click
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    DATA AHEAD (GMT)
    1230 US Philly Fed reports for July 
    1400 US Exisiting Home Sales for June 
    China breakdown of commodity imports due * no time

 (Reporting By Nallur Sethuraman in Bengaluru)
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