December 27, 2019 / 11:47 AM / a month ago

PRECIOUS-Gold holds steady near two-month peak in slow year-end trading

 (Updates prices)
    * Bullion on track for best week in over four months
    * SPDR Gold holdings rise to highest since Nov. 29
    * Silver poised for best week since late August

    By Diptendu Lahiri
    Dec 27 (Reuters) - Gold steadied after rising to its highest
in nearly two months earlier on Friday, as investors cautiously
adjusted their positions in thin year-end trading, but the metal
was still on path for its best week in more than four months.
    Spot gold        was little changed at $1,511.48 per ounce
by 1252 GMT. U.S. gold futures         rose 0.1% to $1,516.10
per ounce.
    Gold rose to its highest since early November at $1,513.88
earlier in the session, but pared gains as traders took profits.
It has gained over 2% so far this week, the most since the week
of Aug. 9.
    "At the end of this year and beginning of the next, a lot of
investors will take and quit their positions in gold, keeping it
kind of steady," said Frederic Panizzutti, managing director at
MKS Dubai.
    "We expect gold prices to be supported by ongoing U.S.-China
trade war, geo-political tensions and very low interest rate
environment. Central banks are on the buying side and that is
not expected to change next year as well."
    Gold has rallied this year on the back of the long-drawn
U.S.-China trade war that triggered fears of a global economic
slowdown and helped the safe-haven metal gain over 17% so far
this year.
    As 2020 approaches, uncertainty is expected to remain high
with unresolved U.S.-China trade issues, Brexit and upcoming
U.S. Presidential elections.
    "With the given uncertainties, $1,500 is quite a good pivot
level for gold. If and when the phase one (trade) deal goes
through, we might see gold breaking that level and trade in the
$1,400s, but only for a short period of time," MKS' Panizzutti
said.
    Meanwhile, news that Russia could consider a part-investment
of its National Wealth Fund in gold provided some further
support to the yellow-metal.              
    "If Russia starts holding gold, being one of the biggest
suppliers to the market, that would significantly dampen
supplies. This is a significant macro driver," said Stephen
Innes, a market strategist at AxiTrader.
    Indicative of investor interest in bullion, holdings in the
world's largest gold-backed exchange-traded fund, SPDR Gold
Trust      , rose 0.4% to 892.37 tonnes, its highest since Nov.
29.          
    Elsewhere, silver        fell 0.2% to $17.85 per ounce, but
was on track for its best week since late August.
    Palladium        edged up 0.1% to $1,902.66 per ounce, while
platinum        was up 0.2% at $948.88 per ounce.

 (Reporting by Diptendu Lahiri and Asha Sistla in Bengaluru,
editing by Louise Heavens and Emelia Sithole-Matarise)
  
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