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Gold keeps gains to trade near one-month high

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Reuters SINGAPORE
Last Updated : Oct 21 2014 | 7:10 AM IST

SINGAPORE (Reuters) - Gold retained overnight gains on Tuesday to trade near a one-month high as Asian equities and the dollar marked time, with markets awaiting China and U.S. data to gauge the strength of the global economy.

FUNDAMENTALS

* Spot gold was little changed at $1,245.50 an ounce by 0034 GMT, after gaining 0.7 percent in the previous session.

* Gold jumped to a one-month high of $1,249.30 last week as fears over a slowdown in the global economy sent investors chasing after safe-haven assets.

* Friday's U.S. data on consumer sentiment and housing starts calmed some nerves, but jitters remained, leaving investors to closely scrutinise economic data.

* Data due at 0200 GMT is expected to show that China's economy grew at its weakest pace in more than five years in the third quarter as a property downturn weighed on demand, raising the chances of more aggressive policy steps from the government.

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* Focus was also on Wednesday's U.S. inflation data and Thursday's European manufacturing reports.

* Despite the slowdown fears, SPDR Gold Trust, the world's largest gold-backed exchange-traded fund, said its holdings fell 1.18 percent to 751.97 tonnes on Monday.

* Gold prices will lag industrial precious metals platinum and palladium in 2015, analysts polled by Reuters predict, as a gradually stabilising world economy favours raw materials over so called "defensive" assets.

* India's central bank will not change its gold import rules, sources with knowledge of the matter said, responding to a report that the world's second-largest consumer of the precious metal was keen to limit imports.

* Physical demand in India will also be keenly watched as the country celebrates the festival of Dhanteras and Diwali this week - key periods for gold purchases.

(Reporting by A. Ananthalakshmi; Editing by Richard Pullin)

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First Published: Oct 21 2014 | 6:58 AM IST

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