(Updates prices) * Palladium hits record high of $1,998.43/oz * U.S. manufacturing production rose 1.1% in Nov * GRAPHIC-2019 asset returns: tmsnrt.rs/2jvdmXl By Karthika Suresh Namboothiri Dec 17 (Reuters) - Gold steadied on Tuesday as robust U.S. manufacturing data lifted risk appetite and offset lingering doubts on U.S.-China trade, while scarce palladium retreated after its record run toward the $2,000 an ounce level. Spot gold was little changed at $1,476.23 per ounce by 01:32 p.m. ET (1832 GMT). U.S. gold futures settled mostly unchanged at $1,480.60. U.S. manufacturing output rebounded more than expected in November, the U.S. central bank said, keeping Wall Street near record levels. "The competition for gold today is equities ... but there is danger out there in the way central banks are behaving; gold has to reflect that. We've created an environment where we require central banks to move the economy forward," said Rob Lutts, chief investment officer at Cabot Wealth Management. While the United States and China claimed to have reached an initial trade agreement, many questions remain unanswered. The preliminary deal reached last week will double U.S. exports to China, White House adviser Larry Kudlow said on Monday. Washington will also reduce some tariffs on Chinese goods. U.S. officials have touted a deal, but Chinese officials have been more cautious, emphasizing the dispute has not been completely settled. "From a technical standpoint, gold is in a bull market. ... Trade deficits and negative interest rates across the globe have been good for gold," said Michael Matousek, head trader at U.S. Global Investors. Elsewhere, British Prime Minister Boris Johnson, emboldened by election victory, put the risk of a hard Brexit back on the table, saying he would make extending the transition period beyond 2020 illegal. Gold is generally used by investors as a place to park assets during economic or political uncertainty. Spot palladium shed 1.7% to $1,944.60 per ounce, retreating from an all-time high of $1,998.43 earlier in the session. The metal, used to make catalytic converters for cars, could see a surge in demand owing to stringent anti-carbon emissions globally. "Supply is tight and when you're adding the speculation about a potential pick-up in demand due to recovery in the global economy, you have a perfect storm of bullish news continuing to keep palladium supported," Saxo Bank analyst Ole Hansen said. Last week's mine shutdowns in South Africa added fuel to palladium's rally. "It's times like these that create the opportunities to buy on pull backs," Matousek said. Platinum eased 0.3% to $926.73 an ounce and silver was down 0.1% at $17.01. (Reporting by Karthika Suresh Namboothiri and Eileen Soreng in Bengaluru; Editing by Sandra Maler and Richard Chang)
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