January 25, 2018 / 1:48 AM / a month ago

PRECIOUS-Gold holds steady near 1-1/2-year highs on weaker dollar

    Jan 25 (Reuters) - Gold prices on Thursday held firm near
1-1/2-year highs hit in the previous session, with the dollar
near three-year lows in the wake of comments by U.S. Treasury
secretary Steven Mnuchin that he welcomed a weaker currency.
        
    FUNDAMENTALS   
    * Spot gold        was nearly unchanged at $1,357.25 per
ounce at 0109 GMT. It rose over 1 percent on Wednesday to hit
its highest since Aug. 5, 2016 at $1,361.81.
    * U.S. gold futures         were mostly unchanged at
$1,356.50 per ounce.
    * The dollar slumped after Mnuchin told the World Economic
Forum in Davos on Wednesday that "obviously a weaker dollar is
good for us as it relates to trade and opportunities". His
comments were seen by markets as a departure from traditional
U.S. currency policy.             
    * The dollar index       , which measures the greenback
against a basket of currencies, hit its weakest since Dec, 2014
at 89.158 on Thursday, matching a more than three-year-low
touched on Wednesday.
    * The immediate focus was on the ECB's policy setting
meeting later in the global day as markets look for any signs
that the central bank is worried about the rapidly appreciating
euro.
    * The euro zone economy may be roaring ahead but a rapidly
strengthening euro may see European Central Bank President Mario
Draghi pour cold water on the view the bank is speeding towards
an interest rate hike.             
    * Asian stocks held near a record-high on Thursday though
concerns about the Trump administration's protectionist stance
cast a shadow on financial markets.            
    * Democratic Republic of Congo's new proposed mining code,
which the industry has warned will stifle investment in the
copper and cobalt-rich nation, sailed through the Senate without
opposition late on Wednesday.             
    * The field of prospective bidders for ScotiaMocatta, the
metals trading arm of Canada's Bank of Nova Scotia         , has
narrowed to two, three banking and industry sources said on
Wednesday.             
    * Zimbabwe's full-year gold production rose to 24.8 tonnes
in 2017 from 22.7 tonnes the previous year, the central bank's
refining and printing subsidiary said on Wednesday.             
    
    
      DATA AHEAD (GMT)
    
     0700   Germany          GfK consumer sentiment          Feb
     0900   Germany          Ifo business climate            Jan
     1245   European Central Bank interest rate announcement
            followed by press conference by ECB President Mario
               Draghi
    1330  U.S.            Advance goods trade balance        Dec
    1330  U.S.            Wholesale inventories              Dec
    1330  U.S.            Retail inventories                 Dec
    1330  U.S.            Weekly jobless claims
    1500  U.S.            New home sales                     Dec
    1500  U.S.            Leading index                      Dec

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