May 30, 2018 / 1:56 AM / 3 months ago

PRECIOUS-Gold gains as Italy crisis drives safe-haven buying

    BENGALURU, May 30 (Reuters) - Gold prices rose in early
Asian trade on Wednesday as political turmoil in Italy and
concerns over Sino-U.S. trade conflict spurred safe-haven
demand.
   
    FUNDAMENTALS  
    * Spot gold        had risen 0.3 percent to $1,301.98 per
ounce by 0125 GMT.
    * U.S. gold futures         for June delivery were up 0.2
percent at $1,301.50 per ounce.
    * Italy may hold repeat elections as early as July after the
man asked to be prime minister failed to secure support from
major political parties for even a stop-gap government, sources
said on Tuesday, as markets tumbled on the growing political
turmoil.             
    * The United States said on Tuesday that it still holds the
threat of imposing tariffs on $50 billion of imports from China
and will use it unless Beijing addresses the issue of theft of
American intellectual property.             
    * Asian shares looked set for a sharp fall on Wednesday as
Italy's political crisis provoked a sell-off on Wall Street,
sent the euro to a 10-month low and spiked borrowing costs for
the government in Rome.            
    * U.S. benchmark 10-year Treasury yields posted their
largest one-day drop on Tuesday since Britain voted to exit the
European Union nearly two years ago.             
    * The U.S. Federal Reserve will have difficulty raising
interest rates significantly beyond the settings of its Japanese
and European counterparts, which are still pursuing
accommodative policy, St. Louis Fed President James Bullard said
on Tuesday.             
    * U.S. interest rates futures rallied on Tuesday as traders
slashed their expectations that the Federal Reserve would raise
key overnight borrowing costs three more times in 2018 as
Italy's political situation threatens European economic growth.
            
    * A top North Korean official was headed to New York on
Tuesday for talks with U.S. Secretary of State Mike
Pompeo.            
    * Holdings of SPDR Gold Trust      , the world's largest
gold-backed exchange-traded fund, rose 0.35 percent to 851.45
tonnes on Tuesday.          
    * Shandong Gold Group Co Ltd            , China's largest
gold producer, is hunting for gold around the world and is
"looking forward to investing in Peru", the chairman of the
company said during a presentation Tuesday.             

    DATA AHEAD (GMT)

    0600  Germany        Import prices                   April 
    0600  Germany        Retail sales                    April
    0645  France         Detailed GDP                    Q1
    0645  France         Consumer spending               April
    0800  Germany        Unemployment rate               May
    0900  Euro zone      Business climate                May
    1200  Germany        Consumer prices                 May
    1215  U.S.           ADP national employment         May
    1230  U.S.           GDP 2nd estimate                Q1
    1230  U.S.           Goods trade balance             April
    1230  U.S.           Wholesale inventories           April
    1800  Federal Reserve issues Beige Book on economic
condition

 (Reporting by Karen Rodrigues in Bengaluru
Editing by Joseph Radford)
  
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