July 23, 2019 / 1:38 AM / 3 months ago

PRECIOUS-Gold dips as dollar hits near 1-week high

July 23 (Reuters) - Gold prices fell in early Asian trade on Tuesday as the dollar rose to a near one-week high on expectation of a smaller interest rate cut by the U.S. Federal Reserve at the end of this month.

FUNDAMENTALS

* Spot gold was down 0.5% at $1,417.11 per ounce as of 0120 GMT.

* U.S. gold futures slipped 0.5% to $1,419.30 an ounce.

* The dollar index gained 0.1% to a near one-week high, making gold expensive for holders of other currencies.

* The U.S. central bank is widely expected to lower its interest rate target range of 2.25%-2.50% by 25 basis points at a meeting ending July 31, but expectations for a larger 50-basis point cut have waxed and waned due to mixed signals from Fed policymakers.

* The global march towards lower interest rates reaches Europe this week with the European Central Bank expected at least to signal easier monetary policy.

* Expectations of policy easing by major central banks such as the Fed propped up global stocks on Tuesday.

* Meanwhile, Sterling was on the back foot on Tuesday as investors worried Boris Johnson, the front runner to become the UK’s next prime minister, would trigger a “hard Brexit” from the European Union.

* SPDR Gold Trust, the world’s largest gold-backed exchange-traded fund, said its holdings rose 0.57% to 825.18 tonnes on Monday from 820.49 tonnes on Friday.

DATA AHEAD

* 1400 US Existing Home Sales June

* 1400 EU Consumer Confid. Flash July (Reporting by Brijesh Patel in Bengaluru; Editing by Subhranshu Sahu)

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