November 21, 2017 / 11:29 AM / in 20 days

PRECIOUS-Gold edges up on lower U.S. dollar; market awaits Fed minutes

    * Global platinum market deficit seen rising sharply in 2018
    * GRAPHIC-Gold/silver ratio: tmsnrt.rs/1UXSq7n
    * GRAPHIC-2017 asset returns: tmsnrt.rs/2jvdmXl

 (New throughout, updates prices, market activity and comments;
adds second byline, NEW YORK dateline)
    By Renita D. Young and Zandi Shabalala
    NEW YORK/LONDON, Nov 21 (Reuters) - Gold bounced up slightly
on Tuesday, as a weaker U.S. dollar gave bullion a boost after
the previous day's sharp decline and as investors awaited the
minutes, due on Wednesday, of the Federal Reserve meeting held
in November. 
    Gold benefited from some safe-haven buying from investors
leery of a political crisis in Germany, Europe's largest
economy.             
    Spot gold        was up 0.3 percent at $1,280.63 an ounce by
1:44 p.m. EST (1844 GMT). The metal fell about 1.4 percent on
Monday, its biggest daily percentage drop since Sept. 11. 
    U.S. gold futures         for December delivery settled up
$6.40, or 0.5 percent, at $1,281.70 per ounce. 
    Silver        climbed 0.2 percent to $16.94 an ounce. On
Monday, silver fell 2.3 percent, its biggest one-day percentage
fall since Sept. 26.
    "Given the fact that gold and silver prices fell so
dramatically yesterday, we have seen a little bargain hunting
coming into the market today," said David Meger, director of
metals trading at High Ridge Futures in Chicago.
    The Fed minutes on Wednesday should provide signals on U.S.
monetary policy.             
    "The Fed rate hike in December is roughly priced in and
unless there are very hawkish minutes, it's more that people are
looking for direction about future moves," said Georgette
Boelle, a commodity strategist at ABN AMRO.
    "It seems likely that we will have more rate hikes next year
which is negative for gold but the Fed will want to see evidence
that inflation is picking up to really be confident in the
interest rate hike path," said Danske Bank analyst Jens
Pedersen. 
    Higher interest rates tend to lift bond yields, supporting
the dollar and making non-yielding bullion less attractive to
investors.             
    The dollar index       , measuring the currency against a
basket of its peers, eased.       
    BMI Research in a note lowered its gold price forecast
slightly to $1,300 per ounce in 2018 and $1,325 in 2019, citing
"our view that the U.S. Fed will hike rates by more than is
reflected in the market," adding inflation and political risks
in 2018 would support gold prices.
    Platinum        was up 1.2 percent at $934.50. Palladium
       gained 1.1 percent at $999.75 an ounce.
    Platinum lost nearly 3 percent Monday, its biggest decline
since early May. On Tuesday, an industry report said the global
platinum market deficit will rise sharply next year.
            

    
 (Additional reporting by Vijaykumar Vedala and Arpan Varghese
in Bengaluru; Editing by David Gregorio, Mark Potter and John
Stonestreet)
  

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