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PRECIOUS-Gold hits over 1-week low as dollar holds firm
October 19, 2017 / 4:32 AM / in a month

PRECIOUS-Gold hits over 1-week low as dollar holds firm

    * Spot gold may target $1,263/oz- technicals
    * Platinum, palladium hit more than one-week low

 (Recasts, adds OANDA analyst's comment, updates prices)
    By Apeksha Nair
    Oct 19 (Reuters) - Gold prices touched the lowest in more
than one week on Thursday, as the dollar stood firm on rising
U.S. Treasury yields, with investors focusing on who would
replace Janet Yellen as the next chair of the Federal Reserve.
    U.S. President Donald Trump is set to make a decision in the
"coming days" on Yellen, who is also one of the five candidates
being considered for the job.             
    Spot gold        eased 0.1 percent to $1,279.25 an ounce as
of 0646 GMT after earlier hitting its lowest since Oct. 9 at
$1,276.22.
    U.S. gold futures         for December delivery were down
0.1 percent at $1,281.40 per ounce.
    "With U.S. yields continuing to creep slowly higher and
stocks markets riding exuberantly high it will most likely take
some sort of geopolitical event to break the yellow metal out of
its bearish malaise," said Jeffrey Halley, senior market analyst
with OANDA, in a note.
    Short-dated U.S. treasury yields on Wednesday jumped on
expectations of tighter global monetary policy.          
    The dollar on Thursday hit its highest in about two weeks
versus the yen       , supported by this week's rise in bond
yields.               
    "Depending on how the dollar goes, we might look at
$1,250-60 as the next stop for gold to trade down. We don't see
immediate upward catalyst for gold except for North Korea," said
Richard Xu, a fund manager at China's biggest gold
exchange-traded fund, HuaAn Gold.
    Higher interest rates tend to boost the dollar and push bond
yields up, putting pressure on gold by increasing the
opportunity cost of holding non-yielding bullion.
    U.S. interest rates futures saw modest losses on Wednesday
after the release of the Fed's Beige Book, but traders still saw
an 80 percent chance of the U.S. central bank raising rates in
December.        
    The economy expanded at a modest to moderate pace in
September through early October, despite the impact of
hurricanes on some regions, the Fed said its latest snapshot of
the U.S. economy.             
    "Looks like fundamentally the (U.S.) economy is doing pretty
well, so that will also put downward pressure on gold," Xu said.
    Spot gold may drop more to $1,263 per ounce, as it has
cleared a support at $1,281, Reuters technicals analyst Wang Tao
said.                  
    In other precious metals, silver        was unchanged at
$16.97 an ounce, while platinum        fell 0.3 percent to
$915.10 an ounce and palladium        was up 0.9 percent at
$960.75 an ounce. 
    Platinum and palladium hit one-week lows earlier in the
session.

 (Reporting by Apeksha Nair in Bengaluru; Editing by Joseph
Radford and Biju Dwarakanath)
  

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