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PRECIOUS-Gold edges up, but stays near 7-wk low on Fed rate hike outlook
May 26, 2016 / 1:22 AM / 2 years ago

PRECIOUS-Gold edges up, but stays near 7-wk low on Fed rate hike outlook

May 26 (Reuters) - Gold inched higher early on Thursday, but
continued to linger near a seven-week low touched in the
previous session as positive U.S. economic data boosted
expectations the Federal Reserve would raise interest rates
sooner rather than later.
    
    FUNDAMENTALS
    * Spot gold had risen 0.2 percent to $1,225.66 per
ounce by 0043 GMT. The metal fell to $1,217.25 on Wednesday, the
lowest since April 6.
    * U.S. gold was up 0.2 percent at $1,225.9.
    * The prospect of an early rate hike, as indicated by Fed
meeting minutes released last week, and a steady dollar have
pushed gold down more than 5 percent so far in May, putting it
on track for its biggest monthly decline since November.
    * Dallas Fed President Robert Kaplan on Wednesday said he
would support raising interest rates in the "near future",
though a vote by Britain on whether to leave the European Union
will weigh on any Fed rate decision in June. 
    * Minneapolis Fed President Neel Kashkari said negative
interest rates, used by central banks in Europe and Japan to
stimulate their economies, would only be a last resort for the
U.S. central bank. 
    * Pimco (Pacific Investment Management Co) Group Chief
Investment Officer Dan Ivascyn said he sees a better than 50/50
chance of a Fed rate increase in June. 
    * Asian shares look set to extend their recovery from
12-week lows on Thursday after renewed optimism on European
banks' prospects and a rise in oil prices to near $50 a barrel
helped lift global shares.  
    * Confidence at Japanese manufacturers tumbled to a
three-year low in May and is seen recovering only modestly in
the next three months, a Reuters poll found, in a sign the yen's
rise is taking its toll on exporters of cars and electronics.
 
    * The yen surged in early trade on Thursday, chipping away
at the recently buoyant dollar as investors looked ahead to a
speech by Fed chief Janet Yellen on whether a rate increase is
imminent and on a pending decision on a planned sales tax hike
in Japan. 
    * Russian precious metals and gems repository Gokhran, which
is part of the finance ministry, does not need to add palladium
or polished diamonds to its stocks in 2016, the country's deputy
finance minister said on Wednesday. 
    * For the top stories on metals and other news, click
 or 
    
    DATA AHEAD (GMT)
    1230 U.S. Durable goods orders Apr 
    1230 U.S. Weekly jobless claims 
    1400 U.S. Pending homes sales Apr

 (Reporting by Koustav Samanta in Bengaluru; Editing by Joseph
Radford)

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