July 3, 2018 / 1:03 PM / 3 months ago

PRECIOUS-Gold bounces from seven-month low as dollar softens

    * Platinum touches lowest since 2008
    * Palladium lower on light U.S. auto sales -trader
    * GRAPHIC-2018 asset returns: tmsnrt.rs/2jvdmXl

 (Updates prices; adds comment, second byline, NEW YORK to
dateline)
    By Renita D. Young and Zandi Shabalala
    NEW YORK/LONDON, July 3 (Reuters) - Gold prices recovered
from a near seven-month low and platinum bounced from close to a
10-year low on Tuesday as the dollar eased.
    Spot gold        gained 0.9 percent to $1,252.96 an ounce at
1:42 p.m. EDT (1742 GMT). Earlier, bullion prices dropped to
$1,237.32, their lowest since Dec. 12, 2017.
    U.S. gold futures         for August delivery settled up
$11.80, or 1 percent, at $1,253.50 per ounce. 
    "First the dollar flipped, and it looks like interest rates
dropped for the 10-year (Treasuries)," said Bart Melek, head of
commodity strategy at TD Securities. "The (yield) curve is
flattening, suggesting that you might not get as much tightening
as thought before."             
    Investors awaited minutes, due on Thursday, of the June U.S.
Federal Reserve meeting and U.S. non-farm payrolls data on
Friday for clues on the direction of U.S. monetary policy
decisions, which affect non-interest yielding gold.
    The dollar index        declined against a basket of
currencies, decreasing the cost of dollar-denominated bullion
for investors using other currencies.
    The United States plans to place tariffs on $34 billion of
Chinese goods as of July 6, but world stocks were supported by
broad gains in Europe and rising oil prices.            
    The U.S. Chamber of Commerce denounced U.S. President Donald
Trump's handling of global trade disputes, issuing a report that
argued those tariffs and retaliation by U.S. partners would
boomerang badly on the economy.             
    Gold prices can increase in times of uncertainty as it is
seen as a safe place to park assets, but bullion has failed to
benefit from recent trade disputes.             
    Analysts warned that gold's rise on Tuesday did not mark the
end of its recent downward trend.
    "It appears quite clear that the trend is still bearish for
gold and that a first positive impulse could only arrive if
prices soar to $1,255," ActivTrades analyst Carlo Alberto De
Casa said.
    Silver        climbed 1.1 percent to $16.01 an ounce.
    Platinum        gained 2.6 percent at $837.10 an ounce.
Earlier, it fell to the lowest since December 2008 at $793.
Palladium        dropped 0.7 percent at $938.20 per ounce.
    Autocatalyst metal platinum tumbled as an intensifying
U.S.-European Union trade spat pressured precious metals, and
political risk in Germany weighed.             
    "Supply and demand fundamentals do not look particularly
attractive for platinum – we expect surpluses to persist 
throughout our forecast period," UBS said in a note, downgrading
its platinum outlook for the year.
    Palladium traded lower than other precious metals, likely
following light U.S. vehicle sales by major automakers, said
Alex Turro, market strategist at RJO Futures.             

 (Reporting by Karen Rodrigues and Apeksha Nair in Bengaluru;
Editing by David Evans and Richard Chang)
  
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