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PRECIOUS-Gold down 1 pct as India extends bullion import ban
June 4, 2013 / 9:36 AM / in 4 years

PRECIOUS-Gold down 1 pct as India extends bullion import ban

* India's gold imports could tumble in June -analyst
    * U.S. futures trading volume thin
    * Investors await U.S. non-farm payroll data on Friday
    * Coming up: U.S. factory orders Wednesday

 (Updates throughout, Updates comments; adds second dateline,
byline, pvs LONDON)
    By Frank Tang and Clara Denina 
    NEW YORK/LONDON, June 4 (Reuters) - Gold fell about 1
percent on Tuesday to extend losses after the world's largest
bullion consumer India further restricted imports of the
precious metal.
    The Reserve Bank of India (RBI) on Tuesday extended the
import restrictions placed on banks, which were introduced last
month, to all nominated agencies and trading houses.
    The move came after Monday's data showed India's gold
imports jumped to around 162 tonnes in May from 142.5 tonnes in
    "The news that the RBI will curb imports of gold by agencies
has weighed prices down today as it is a wider restriction and
could imply lower imports of gold into the country," Societe
Generale analyst Robin Bhar said.
    Bhar said that June imports could drop to between 50 and 100
tonnes with India at the end of the wedding and Hindu festival
seasons. Both are traditionally major gold-buying events.
    Spot gold fell 1 percent to $1,397.34 an ounce by
2:54 PM EDT (1854 GMT). 
    On Monday, it gained nearly 2 percent after data showed U.S.
manufacturing activity had slowed to the lowest level in nearly
four years, weakening arguments for the Federal Reserve to slow
its $85 billion monthly mortgage-bond buying. 
    The central bank said in May that it would scale back its
easing sooner if economic indicators showed signs of continued
    An overall improvement in the U.S. economy and the absence
of any inflation in the near future could weigh on gold as
interest rates begin to climb, analysts said.
    "The potential for real rates to turn positive, which would
incur a greater opportunity cost in owning gold, would thus be
negative for bullion prices," said James Steel, chief metals
analyst at HSBC.
    U.S. economic data will remain in focus this week, as
Friday's non-farm payroll data for May will provide investors
with more clues about how long the Fed might keep U.S. stimulus
measures in place.
    U.S. Comex gold futures for for August delivery
settled down $14.70 at $1,397.20 an ounce, with trading volume
about 50 percent below its 30-day average, preliminary Reuters
data showed.
    Holdings of the SPDR Gold Trust, the largest
gold-backed exchange-traded fund, remained unchanged on Monday
for the fourth day in a row following hefty outflows in the last
three months. 
     Silver fell 1.2 percent to $22.43 an ounce. Platinum
 was down 0.3 percent to $1,489.24 an ounce and palladium
 lost 1.2 percent at $747.72 an ounce. 

 2:54 PM EDT     LAST/    NET   PCT      LOW    HIGH  CURRENT
                SETTLE   CHNG  CHNG                       VOL
 US Gold AUG   1397.20 -14.70  -1.0  1388.10 1414.80  104,050
 US Silver JUL  22.409 -0.312  -1.4   22.225  22.730   28,584
 US Plat JUL   1491.10  -6.30  -0.4  1480.50 1500.40    9,033
 US Pall SEP    751.05  -8.00  -1.1   746.10  759.90    2,389
 Gold          1397.34 -13.76  -1.0  1389.80 1414.76         
 Silver         22.430 -0.280  -1.2   22.320  22.770
 Platinum      1489.24  -3.76  -0.3  1484.75 1496.50
 Palladium      747.72  -8.78  -1.2   748.50  756.75
 TOTAL MARKET              VOLUME          30-D ATM VOLATILITY
                CURRENT   30D AVG  250D AVG   CURRENT     CHG
 US Gold        109,351   228,325   181,990     21.51    0.94
 US Silver       34,033    62,310    55,563     30.88   -0.91
 US Platinum     10,116    11,096    11,635      21.6   -0.89
 US Palladium     2,609     6,618     5,562                  
 (Editing by William Hardy, Keiron Henderson and Bob Burgdorfer)

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