March 1, 2017 / 12:56 AM / 5 months ago

PRECIOUS-Gold dips on firmer dollar ahead of Trump policy speech

4 Min Read

    March 1 (Reuters) - Gold slipped on Wednesday on a stronger
dollar ahead of a speech by U.S. President Donald Trump that
investors hope will shed more light on the details of his
economic policy.
    
    FUNDAMENTALS
    * Spot gold        had dropped 0.3 percent to $1,244.93 per
ounce by 0034 GMT. The metal hit its highest since Nov. 11 at
$1,263.80 on Feb. 27.
    * U.S. gold futures         fell 0.7 percent to $1,245.
    * World financial markets will be scrutinizing Trump's
address in the House of Representatives at 0200 GMT for
specifics on how he aims to make good on promises to tackle tax
reform, boost infrastructure spending and simplify regulations
he says are harming business.             
    * The president had already said on Monday that he would
propose a budget that would increase spending on defence while
seeking savings elsewhere.             
    * The dollar index        rose 0.4 percent. 
    * A handful of Federal Reserve policymakers on Tuesday
jolted markets into higher expectations for a March U.S.
interest rate increase, with comments that suggested
rate-setters are worried about waiting too long in the face of
pending economic stimulus from Washington.             
    * The comments sparked a flurry of selling in the bond
market, with the two-year Treasury yield jumping to its highest
level since December. 
    * Interest rate futures implied traders saw nearly a
57-percent chance the Fed would raise rates at its March 14-15
meeting, up from roughly 31 percent late on Monday, and around
20 percent a week ago, according to Reuters data.
    * The U.S. economy expanded at a slower pace in the fourth
quarter and appeared to remain on a moderate growth path as
Trump took office with a promise to reinvigorate manufacturing
and protect jobs.             
    * Sales of U.S. Mint American Eagle gold coins fell to a
14-month low while silver coin sales were also sharply lower in
February, the latest government data showed on Tuesday, as
bullion prices rose for the second straight month.             
    * INTL FCStone Ltd, a London-based subsidiary and precious
metals division of INTL FCStone Inc         , said this week
that it was launching a web-based physical gold trading
platform.             
    * Russia remained the world's third largest gold producer in
2016 behind China and Australia, data from its finance ministry
showed on Tuesday.                
    
    
       
    DATA AHEAD (GMT)
      0100  China       Official manufacturing PMI        Feb 
      0100  China       Official non-manufacturing PMI    Feb 
      0145  China       Caixin manufacturing PMI final    Feb 
      0850  France      Markit manufacturing PMI          Feb 
      0855  Germany     Markit/BME manufacturing PMI      Feb 
     0900  Germany      Unemployment rate                 Feb 
     0900  Euro zone     Markit manufacturing PMI final   Feb   
     1300  Germany       Consumer prices                  Feb 
     1330  U.S.          Personal income                  Jan 
     1500  U.S.          Construction spending            Jan 
     1500  U.S.          ISM manufacturing PMI            Feb 
    

 (Reporting by Nallur Sethuraman in Bengaluru; Editing by Joseph
Radford)
  

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