November 22, 2017 / 4:52 AM / a year ago

PRECIOUS-Gold inches up as dollar dips ahead of Fed meeting minutes

    * Palladium rise to highest since Nov. 10
    * Asian shares hit highest in a decade
    * GRAPHIC-2017 asset returns:

 (Updates prices, adds quote)
    By Vijaykumar Vedala
    Nov 22 (Reuters) - Gold prices crept up on Wednesday amid a
softer dollar, with investors remaining cautious ahead of the
release of minutes from the U.S. Federal Reserve's last meeting,
which could offer hints on the outlook for the central bank's
monetary policy.
    Spot gold        was up 0.2 percent at $1,283.21 per ounce
by 0817 GMT.
    U.S. gold futures for December delivery         gained 0.1
percent at $1,282.80.
    "We are not really sure that this (Fed meeting minutes) will
have much of an impact given that the decision to raise rates in
December is pretty much a forgone conclusion," INTL FCStone
analyst Edward Meir said.
    "Nevertheless, we suspect that investors will want to see
what policymakers are thinking about the rate situation and how
aggressive they will be on this front going forward." 
    The Fed kept interest rates unchanged at its last meeting,
minutes of which will be released on Wednesday.             
    The Fed is "reasonably close" to its goals and should keep
gradually raising U.S. interest rates to avoid the dual pitfalls
of letting inflation drift below target for too long, and of
driving unemployment down too far, Fed Chair Janet Yellen said
on Tuesday.               
    Higher interest rates help the dollar gain and push bond
yields up, putting pressure on gold prices by increasing the
opportunity cost of holding non-yielding bullion.
    In other markets, the dollar index against a basket of six
major currencies        was down 0.2 percent.       
    Amid lack of investment demand, gold's inverse relationship
with the dollar is the strongest in more than a decade, Julius
Baer analyst Carsten Menke said in a note.
    "While the dollar is unlikely to return to its recent peak,
we still see upside from current levels as the U.S. Federal
Reserve continues to hike interest rates. This should weigh on
gold prices heading into next year."
    A stronger greenback makes dollar-denominated gold more
expensive for holders of other currencies. 
    Meanwhile, Asian shares joined a global rally to reach their
highest in a decade on Wednesday as strong world growth and
rising corporate profits lured hordes of investors into
    Gold investors are being guarded following the rally in
stocks, said Dick Poon, general manager at Heraeus Metals Hong
Kong Limited.
    In other metals, silver        rose 0.4 percent to $17.03 an
ounce, while platinum        gained 0.1 percent to $934 an
ounce. Palladium        was up 0.5 percent to $1,003.70 an
ounce, the highest since Nov. 10.

 (Reporting by Vijaykumar Vedala in Bengaluru; Editing by
Gopakumar Warrier and Christian Schmollinger)
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