January 17, 2018 / 1:50 AM / a year ago

PRECIOUS-Gold edges up as dollar index slumps to 3-yr lows

    Jan 17 (Reuters) - Gold prices edged up on Wednesday towards
four-month highs hit early in the week, as the U.S. dollar
slumped to three-year lows against a basket of currencies.
    
    FUNDAMENTALS    
    * Spot gold        was up 0.3 percent at $1,341.96 an ounce
by 0123 GMT. It touched its strongest since Sept. 8 at $1,344.44
on Monday.
    * Spot gold edged down for the first time in five sessions
on Tuesday, easing 0.1 percent.
    * U.S. gold futures         were up 0.4 percent at $1,342 an
ounce. 109 square kilometres
    * The dollar index was down 0.1 percent at 90.300       ,
after dropping to its lowest since December, 2014 at 90.113.
    * Three sources close to European Central Bank policy-making
told Reuters that the ECB is unlikely to ditch a pledge to keep
buying bonds at next week's meeting as rate setters need more
time to assess the outlook for the economy and the euro.
            
    * The ECB last week signalled a growing appetite for
revising its policy message in "early" 2018, and specifically a
promise to continue its 2.55 trillion euro money-printing
programme until inflation heads back to target.
    * Asian stocks stepped back from a record high on Wednesday
as the region's resource shares were dented by falling oil and
commodity prices while digital currencies tumbled on worries
about tighter regulations.            
    * Palladium        was up 0.3 percent at $1,097. The metal,
which hit a record high of $1,138 an ounce on Monday, fell
nearly 3 percent on Tuesday. 
    * Palladium has had a sustained rally as high demand in the
auto industry fueled supply concerns, sending Nymex palladium
futures net long positions to record highs.
    * Palladium, the hottest property in the precious metals
deck last year, is tipped for a record performance in 2018 even
among bearish forecasters, but the metal could become a victim
of its own success.             
    * Kazakhstan raised its gold holdings by 5.31 tonnes to
300.98 tonnes in Dec. 2017, IMF data showed
    * Polyus          , Russia's largest gold producer, on
Tuesday reported fourth-quarter sales of $734 million, up 11
percent year on year, on higher production and prices.
            
    * Standard Chartered on Tuesday raised its second half 2018
gold price forecast, taking annual average forecast to $1,324
per ounce from $1,285.
    * Canadian gold miner Goldcorp Inc        is "done" with
mergers and acquisitions and will focus on building new mines at
projects it already owns and on improving existing operations,
Chief Executive David Garofalo said on Tuesday.             
    
   DATA AHEAD (IN GMT)
    
      1415  U.S.  Industrial production           Dec
      1500  U.S.  NAHB housing market index       Jan
      1500  U.S. Senate Banking Committee votes on nomination of
          Jerome Powell to be chairman of the Federal Reserve

 (Reporting by Nallur Sethuraman in Bengaluru; editing by
Richard Pullin)
  
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