July 13, 2017 / 1:11 AM / 13 days ago

PRECIOUS-Gold steady after Yellen hints at only gradual tightening

3 Min Read

    BENGALURU, July 13 (Reuters) - Gold prices held steady on
Thursday after U.S. Federal Reserve Chair said the central bank
would only gradually tighten monetary policy, curbing
speculation that interest rates would rise more than once this
year.
        
    FUNDAMENTALS    
    * Spot gold        was nearly flat at $1,219.06 per ounce at
0050 GMT.
    * U.S. gold futures         for August delivery fell 0.06
percent to $1,218.30 per ounce.
    * The U.S. economy is healthy enough for the Fed to raise
rates and begin winding down its massive bond portfolio, though
low inflation and a low neutral rate may leave the central bank
with diminished leeway, Fed Chair Janet Yellen said on
Wednesday.                 
    * The dollar was capped against a basket of currencies early
on Thursday after Yellen did not sound as hawkish as many had
anticipated, while the Dow rose to a record high close.       
            
    * Current U.S. short-term interest rates might be too low
for the Federal Reserve to address the next economic downturn,
even after four rate increases since December 2015, Kansas City
Federal Reserve President Esther George said on Wednesday.
            
    * Bank of Japan policymakers see little to cheer in
successfully defending their yield target as European and U.S.
central banks start to pull the plug on ultra-cheap money,
casting doubt on their view that global bond yield gains will be
short-lived.             
    * U.S. President Donald Trump said on Wednesday he did not
fault his son Donald Trump Jr. for meeting with a Russian lawyer
during the 2016 presidential election campaign and he was
unaware of the meeting until a few days ago.             
    * Russia's largest gold producer Polyus is buying an
additional 25.1 percent in Sukhoi Log, one of the world's
largest untapped gold deposits, in an all-share deal worth
$145.9 million, the company said on Tuesday.             
    
    DATA AHEAD (GMT)    
     0600      Germany   Final consumer prices       June  
     0645      France    Consumer prices (INSEE)     June  
     1230      U.S.      Producer prices             June
     1230      U.S.      Jobless claims              weekly 
     1000/1400 U.S. Fed Chair Janet Yellen delivers her 2nd day
of semiannual monetary policy testimony before the Senate
Banking Committee 
    

 (Reporting by Nithin Prasad in Bengaluru; Editing by Richard
Pullin)
  

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