EuropeStay updated with Business News, Pakistan news, Current world news and latest world news with Business Recorder..http://www.brecorder.com/markets/commodities/europe.htmlSat, 01 Nov 2014 00:23:31 +0000SRA Framework 2.0en-gbGold, silver tumble to 4-year lows on dollar, shareshttp://www.brecorder.com/markets/commodities/europe/202772-gold-silver-tumble-to-4-year-lows-on-dollar-shares.htmlhttp://www.brecorder.com/markets/commodities/europe/202772-gold-silver-tumble-to-4-year-lows-on-dollar-shares.htmlimageLONDON: Gold and silver slumped to their lowest since 2010 on Friday as the dollar and stock markets soared following a new round of quantitative easing by the Bank of Japan and US data showing a robust economy.

Spot gold slid 2.5 percent to its lowest since July 2010 at $1,168.66 an ounce in earlier trade and was down 2.2 percent at $1,172.50 by 1046 GMT.

The metal breached important support levels at $1,200 and $1,180, where stop losses - automatic sale orders - were placed and was on track for a 4.7 percent drop this week, the biggest weekly decline since June 2013.

US gold futures were down $26.70 an ounce at $1,171.90. "Spot gold is at its lowest for four years ... and it could fall further towards the $1,120 level if the dollar strengthened even more significantly," ActivTrades analyst Carlo Alberto De Casa said.

"More stop losses could be triggered if we consistently broke below $1,170, but the downside seems limited by the fact that we are close to cost of production above $1,000."

Spot silver fell nearly 3 percent to its lowest since February 2010 at $15.94 an ounce and was poised for a fourth monthly drop in a row. It was down 2.4 percent at $16.00. Both gold and silver were already facing some heat after the US Federal Reserve earlier in the week largely dismissed financial market volatility, a slowdown in Europe and a weak inflation outlook as factors that might undercut progress towards its unemployment and inflation goals.

The hawkish comments and the strong US gross domestic product data on Thursday dulled gold's appeal as a hedge against risk.

The dollar rose to a four-week high against a basket of main currencies, boosted as well by the Bank of Japan's surprise move to expand its massive monetary easing, which weakened the yen to near seven-year lows.

A stronger US currency makes dollar-denominated assets such as gold more expensive for other currency holders. "We hold a bearish view on gold, considering a recovering US economy and expectations of higher rates," said Chen Min, a precious metals analyst at Jinrui Futures in Shenzhen.

"In the long term, we believe gold is likely to break closer to $1,000." Reflecting bearish investment sentiment, holdings in the SPDR Gold Trust, the world's largest gold-backed exchange-traded fund, fell 0.16 percent to 741.20 tonnes on Thursday, a six-year low.

NO SUPPORT FROM PHYSICAL MARKETS

Gold failed to get any support from the Asian physical markets, a factor that could push it to further lows. Physical demand usually provides a floor to dropping prices. Buyers in top consumer China failed to emerge even after the drop below $1,200.

Premiums on the Shanghai Gold Exchange, the main platform for physical trades in the country, slipped on Friday to less than $1 an ounce, occasionally dropping to a discount against the global benchmark represented by the London spot price.

Premiums had ranged between $1 and $2 on Thursday.

The lower premiums underscore the soft appetite for gold in China after record consumption last year.

China's gold consumption tumbled 21.4 percent year-on-year in the first nine months of 2014 to 754.8 tonnes, the China Gold Association said in the statement on Friday.

Among the other precious metals, platinum fell 0.7 percent to $1,228.75 an ounce, while palladium rose 0.6 percent to $779.10 an ounce.

Copyright Reuters, 2014

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s.rs96@yahoo.com (Shoaib-ur-Rehman Siddiqui)EuropeFri, 31 Oct 2014 13:37:53 +0000
Copper rises, set for first monthly gain since Julyhttp://www.brecorder.com/markets/commodities/europe/202758-copper-rises-set-for-first-monthly-gain-since-july.htmlhttp://www.brecorder.com/markets/commodities/europe/202758-copper-rises-set-for-first-monthly-gain-since-july.htmlimageLONDON: Copper rose on Friday, on track for its first monthly gain in three months, as risk appetite improved after the Bank of Japan's surprise move to expand its stimulus programme boosted equity markets.

Three-month copper on the London Metal Exchange (LME) rose 0.4 percent to $6,769.25 a tonne by 1116 GMT and is up 1.5 percent so far in October.

The Bank of Japan unexpectedly eased monetary policy on Friday in a 5-4 vote, due to concerns that cheaper oil would weigh on consumer prices and delay a shift in sentiment away from deflation.

The move sparked a rally in equity markets in Asia and Europe, and pushed the yen to a seven-year low against the dollar.

Cheaper money tends to spur demand for commodities because it lowers the cost of business, and raises the value of hard assets against depreciating fiat currency.

"We saw some significant moves in Asian risk assets and that has lent support to risk appetite and to base metals," said Gayle Berry, metals strategist at Jefferies Bache.

"To me it feels temporary, but that said, positioning is short for some of the metals and the complex could have a bit of a bounce towards the end of the year."

Alleviating some concerns about supply, workers at Freeport-McMoRan Inc's Indonesian copper mine have cancelled a planned one-month strike due to start next week, a union official said, after reaching an agreement with management.

The global copper market will be in deficit for a fifth straight year in 2014 before switching to a surplus of about 390,000 tonnes next year, an industry group said.

Analysts polled by Reuters earlier in October expected the copper market to show a surplus this year and to post an even bigger surplus in 2015, but that view is threatened by events such as strikes and delays.

"We have a call for a modest downside in the (copper) price to just below $3 a pound ($6,600 a tonne).

But too much below that, you see scrap supply drying up and China is pretty price-sensitive at those levels," said analyst Daniel Morgan at UBS in Sydney.

Copyright Reuters, 2014

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s.rs96@yahoo.com (Shoaib-ur-Rehman Siddiqui)EuropeFri, 31 Oct 2014 13:13:09 +0000
Tunisia gets offers in tender for 142,000 T durum wheat http://www.brecorder.com/markets/commodities/europe/202741-tunisia-gets-offers-in-tender-for-142000-t-durum-wheat.htmlhttp://www.brecorder.com/markets/commodities/europe/202741-tunisia-gets-offers-in-tender-for-142000-t-durum-wheat.htmlimageHAMBURG: The lowest offer in the tender from Tunisia's state grains agency on Friday to purchase 142,000 tonnes of durum wheat was $484 a tonne c&f for grain from optional origins including Mexico, European traders said.

This was followed by an offer of $499.90 a tonne c&f, but most offers were between $550-$610 a tonne c&f, traders said.

No purchase had yet been made and tender results are expected later on Friday, traders said.

Copyright Reuters, 2014

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s.rs96@yahoo.com (Shoaib-ur-Rehman Siddiqui)EuropeFri, 31 Oct 2014 12:32:12 +0000
London copper steady, set to post small monthly gain http://www.brecorder.com/markets/commodities/europe/202603-london-copper-steady-set-to-post-small-monthly-gain.htmlhttp://www.brecorder.com/markets/commodities/europe/202603-london-copper-steady-set-to-post-small-monthly-gain.htmlimageSYDNEY: London copper was little changed on Friday as a dollar-rally threatened to extinguish its modest monthly gains, and as traders said further strength in the greenback may erode prices going into November.

The US dollar held at four-week highs against a basket of major currencies early on Friday, getting another boost from encouraging growth data a day after the Federal Reserve gave an upbeat assessment on the economy.

"We have a call for a modest downside in the price to just below $3 a pound ($6,600 a tonne). But too much below that, you see scrap supply drying up and China is pretty price-sensitive at those levels," said analyst Daniel Morgan at UBS in Sydney.

Three-month copper on the London Metal Exchange was trading flat at $6,738 a tonne by 0309 GMT, after dropping 1.2 percent the session before.

A smaller trade deficit and surge in defence spending buoyed US economic growth in the third quarter, but domestic demand slipped, hinting at some loss of momentum.

LME copper hit its highest in six weeks at $6,835.50 a tonne on Wednesday, with a gradual rise supported by tighter than expected refined supply against a backdrop of soft if steady demand.

The global copper market will be in deficit for a fifth straight year in 2014 before switching to a surplus of about 390,000 tonnes next year, an industry group said this week.

Elsewhere, there are indications Zambia may be backing away from plans to impose a 20 percent royalty rate on open pit mining in the country, a top executive with Barrick Gold Corp said on Thursday.

The most-traded January copper contract on the Shanghai Futures Exchange eased 0.5 percent to 47,500 yuan($7,772) a tonne.

"There will be more interesting commodities than copper in the next 12 months - like nickel," said Morgan at UBS.

"Bad weather in the Philippine will offer a headwind to (ore) supply and you'll get a lift in prices," he added.

China's nickel pig iron producers are drawing down their stockpiles faster in the past month due to disruptions in Philippine ore exports, refuelling supply worries and fanning a nickel rally, industry sources said.

LME nickel prices are up 5 percent this week at $15,751 a tonne, paring a monthly loss to around 3 percent, after prices collapsed from around two-year highs seen in May.

Meanwhile, commodity trading giant Trafigura could raise its stake in Belgium's Nyrstar, strengthening its grip on the world's largest zinc producer as tighter supplies and mine closures are forecast to boost prices for the metal.

Copyright Reuters, 2014

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rocking.saad.jabri@gmail.com (Saad Jabri)EuropeFri, 31 Oct 2014 05:11:11 +0000
Copper slips as dollar rallies on Fed comments and US datahttp://www.brecorder.com/markets/commodities/europe/202553-copper-slips-as-dollar-rallies-on-fed-comments-and-us-data.htmlhttp://www.brecorder.com/markets/commodities/europe/202553-copper-slips-as-dollar-rallies-on-fed-comments-and-us-data.htmlimageLONDON: Copper fell more than 1 percent on Thursday as the dollar rallied on strong US growth data and the Federal Reserve's relatively hawkish tone on monetary policy.

Data showing US gross domestic product grew at a better than expected 3.5 percent annual rate in the third quarter, though the pace of growth in business investment, housing and consumer spending slowed.

The dollar extended gains made the previous day when the Federal refrained from characterising the slack in the US labour market as significant. Investors perceived this as hawkish and reappraised the consensus that the Fed's first interest rate increase would be late in 2015.

A strong dollar makes dollar-priced metals more costly for European and other non-US investors. Three-month copper on the London Metal Exchange traded down 1.6 percent at $6,705 a tonne in official midday rings, having firmed slightly in the previous session.

"The Fed statement lent support to the dollar and affected commodities, but the bottom line is mine expansions (in copper) is setting the market up for surplus. I'd target $6,500 between now and the year-end," said Harry Tchilinguirian, head of commodity strategy at BNP Paribas.

Copper is down 8 percent this year on concerns about slowing demand from top user China as it grapples with falling property prices while rising supply is expected to swing the market to a large surplus next year.

Still limiting losses in the metal, Chinese shares touched a 20-month high after the government said it would promote consumption in six sectors of the economy, including housing. China consumes about 45 percent of the world's copper.

EURO ZONE RECOVERY?

There was also an unexpected improvement to euro zone economic sentiment in October, picking up from a near one-year low in September, indicating that the bloc's struggling economy could take a turn for the better by the end of the year.

Copper was supported on Wednesday by rumours that China's State Reserve Board (SRB) has resumed purchasing copper and by looming strike action at key mines in Indonesia and Peru.

But on a longer term view, mine supply is rising. China's copper smelters may be paid between 9 percent and 20 percent more in fees for processing raw material concentrate next year as mine supply increases, traders and smelter executives said.

Also weighing on copper, two of China's biggest banks reported sharply higher bad loans for the third quarter, with one adding that a credit crunch squeezing small companies in the country's export-oriented eastern provinces may be spreading westward.

In positive news for zinc, which is used in galvanising, China Railway Corporation said that all 64 railway projects planned for this year had been approved and would start by the end of the year.

Zinc traded down 0.57 percent in rings to $2,282 a tonne while nickel, which had climbed more than 7 percent in early Wednesday trading, gave back 1.8 percent to trade at $15,390 a tonne.

Lead was down 0.98 percent at $2,015 a tonne, aluminium fell 0.99 percent to $2,010 a tonne and tin was last bid down 0.75 percent in rings at $19,975 a tonne.

Copyright Reuters, 2014

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s.rs96@yahoo.com (Shoaib-ur-Rehman Siddiqui)EuropeThu, 30 Oct 2014 15:25:43 +0000
Gold dips below $1,200/oz after upbeat Fed statementhttp://www.brecorder.com/markets/commodities/europe/202545-gold-dips-below-$1200oz-after-upbeat-fed-statement.htmlhttp://www.brecorder.com/markets/commodities/europe/202545-gold-dips-below-$1200oz-after-upbeat-fed-statement.htmlimageLONDON: Gold prices dipped below $1,200 an ounce on Thursday and silver slid to a 4-1/2 year low after the Federal Reserve ended its bond-buying stimulus programme with unexpectedly upbeat comments about the economy.

Spot gold fell as low as $1,199.90 an ounce and was down 0.7 percent at $1,203.30 an ounce at 1447 GMT. US December gold futures were down $22.30 at $1,202.60. Silver was down 3.2 percent at $16.50 an ounce, having earlier hit its lowest since March 2010 at $16.45.

The Fed statement on Wednesday, coupled with unexpectedly strong third-quarter US economic growth data, sent the dollar to its highest since Oct. 6, while US interest rate futures shifted to show better-than-even chances of a rate rise next September. Previously, they had indicated a rise in October.

That dented interest in gold, which as a non-yielding asset tends to benefit from ultra-low rates. The US central bank largely dismissed financial market volatility, a slowdown in Europe and a weak inflation outlook as factors that might limit progress towards its unemployment and inflation goals.

"The feeling was that given the turmoil markets had seen earlier in the month, maybe the Fed might have been a little more dovish," Michael Lewis, head of commodity research at Deutsche Bank said. "(But) what the Fed said was that that hadn't changed its outlook."

"Our sense is that there are still obviously more adjustments still to come in terms of rates, dollar, and equity risk premium," he added. "The adjustment is higher in terms of real rates, and the dollar, and we do feel that gold will be breaking those lows." Gold, which hit a 15-month low of $1,183.46 earlier this month -- a level it bounced off in 2013 -- fell 1.3 percent on Wednesday after the Fed statement was released.

Commerce Department data showed on Thursday that a smaller trade deficit and a surge in defense spending buoyed US growth in the third quarter, though other details of Thursday's report hinted at some loss of momentum. SUPPORT AT $1,200/oz Although gold prices are expected to find good support at $1,200 an ounce, a key psychological chart level, analysts said downward momentum remains strong.

"Overwhelming bearish pressures weigh on the metal, with both technical and fundamental indicators pointing lower," UBS said in a note. "(That could take) the price towards significant support at 1183.23, (the) October low, which also coincides with December 2013 low." In a reflection of investor sentiment, the world's largest gold-backed exchange-traded fund, SPDR Gold Trust, said its holdings fell 1.2 tonnes to 742.40 tonnes on Wednesday, a six-year low.

The fund reported its biggest weekly outflow this year last week. The outflows could undermine any possible rally in gold.

In the physical markets, too, buying interest fell. Premiums in top consumer China were about $1-$1.50 an ounce on Thursday, down from about $2 on Wednesday.

"With the heightened negative sentiment, we expect to see even more scaled-up selling from the speculative community as well as producers who have been active on rallies over the last few weeks," MKS Group said in a note.

Spot platinum was down 1 percent at $1,241.25 an ounce, while spot palladium fell 1 percent to $781.25 an ounce.

Copyright Reuters, 2014

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s.rs96@yahoo.com (Shoaib-ur-Rehman Siddiqui)EuropeThu, 30 Oct 2014 15:06:54 +0000
Gold slides towards $1,200/oz after upbeat Fed statementhttp://www.brecorder.com/markets/commodities/europe/202493-gold-slides-towards-$1200oz-after-upbeat-fed-statement.htmlhttp://www.brecorder.com/markets/commodities/europe/202493-gold-slides-towards-$1200oz-after-upbeat-fed-statement.htmlimageLONDON: Gold prices slid towards $1,200 an ounce on Thursday, hitting their lowest in 3-1/2 weeks, after the Federal Reserve ended its bond-buying stimulus programme on an unexpectedly hawkish note.

Spot gold fell as low as $1,201.21 an ounce and was down 0.5 percent at $1,206.40 an ounce at 1015 GMT. US December gold futures were down $19 at $1,205.80.

The Fed statement on Wednesday sent the dollar to its highest since Oct. 6, while US rate futures shifted to show better-than-even chances of a rate hike next September.

Previously, they had indicated a rise in October.

That dented interest in gold, which as a non-yielding asset tends to benefit from ultra-low rates.

"I'm not saying that we're going to get a higher interest rate environment any time soon, but the signals are there," Simon Weeks, head of precious metals at the Bank of Nova Scotia, said. "$1,200 might hold today, but overall I think it will be broken, and we'll look at that double bottom at $1,180 again."

Gold, which hit a 15-month low of $1,183.46 earlier this month -- a level it had already bounced off in 2013 -- fell 1.3 percent on Wednesday after the Fed statement was released.

The US central bank largely dismissed financial market volatility, a slowdown in Europe and a weak inflation outlook as factors that might limit progress towards its unemployment and inflation goals.

Ending its monthly bond purchases, the bank dropped a characterisation of US labour market slack as "significant" in a show of confidence in the economy's prospects.

The US Commerce Department will release gross domestic product figures at 1230 GMT.

The economy is expected to have grown at a solid 3 percent annual rate in the third quarter. SUPPORT AT $1,200/oz Although gold prices are expected to find good support at $1,200 an ounce, a key psychological chart level, analysts said downward momentum remains strong.

"Overwhelming bearish pressures weigh on the metal, with both technical and fundamental indicators pointing lower," UBS said in a note. "(That could take) the price towards significant support at 1183.23, (the) October low, which also coincides with December 2013 low."

In a reflection of investor sentiment, the world's largest gold-backed exchange-traded fund, SPDR Gold Trust, said its holdings fell 1.2 tonnes to 742.40 tonnes on Wednesday, a six-year low.

The fund reported its biggest weekly outflow this year last week.

The outflows could undermine any possible rally in gold.

In the physical markets, too, buying interest fell. Premiums in top consumer China were about $1-$1.50 an ounce on Thursday, compared with about $2 on Wednesday.

"With the heightened negative sentiment, we expect to see even more scaled-up selling from the speculative community as well as producers who have been active on rallies over the last few weeks," MKS Group said in a note.

Silver was down 1 percent at $16.87 an ounce. Spot platinum was down 0.2 percent at $1,251.25 an ounce, while spot palladium was down 0.4 percent at $786.25 an ounce.

Copyright Reuters, 2014

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s.rs96@yahoo.com (Shoaib-ur-Rehman Siddiqui)EuropeThu, 30 Oct 2014 12:16:24 +0000
Copper falls 1 pct as dollar rallies on Fed commentshttp://www.brecorder.com/markets/commodities/europe/202485-copper-falls-1-pct-as-dollar-rallies-on-fed-comments.htmlhttp://www.brecorder.com/markets/commodities/europe/202485-copper-falls-1-pct-as-dollar-rallies-on-fed-comments.htmlimageLONDON: Copper fell more than 1 percent on Thursday as the dollar rallied after the US Federal Reserve sounded a relatively hawkish tone on monetary policy, though losses were limited by gains in Chinese equities.

The Federal Reserve retained its guidance Wednesday that overnight borrowing costs would remain near zero for a "considerable time", but it dropped a characterization of the US labour market slack as "significant".

Investors perceived this as a show of confidence in the economy's prospects, and proceeded to buy the dollar. A strong dollar makes dollar-priced metals costly for European and other non-US investors.

Three-month copper on the London Metal Exchange slipped 1.1 percent to $6,739.25 a tonne by 1055 GMT, after ending slightly firmer in the previous session when it struck its highest level since Sept. 19.

"On a day perspective the Fed statement lent support to the dollar and affected commodities, but the bottom line is mine expansions (in copper) are setting the market up for surplus. I'd target $6,500 between now and the year end," said BNP Paribas' head of commodity market strategy Harry Tchilinguirian.

Copper is down some 8 percent this year on concerns about slowing demand from top user China, which is grappling with falling property prices, and rising supply which is expected to swing the market into a wide surplus next year.

Still limiting losses in the metal, China shares touched a 20-month high earlier after the government said it would promote consumption in six sectors of the economy, including housing.

China consumes some 45 percent of the world's copper.

Also, euro zone economic sentiment unexpectedly rose in October, picking up from a near one-year low in September, in an indication that the bloc's struggling economy may be slowly improving at the end of the year.

Copper hit a three week high on Wednesday, supported by rumours that China's State Reserve Board (SRB) has resumed purchasing copper and by looming strike action at key mines in Indonesia and Peru.

On a longer term view though, mine supply is rising. China's copper smelters may be paid between 9 percent and 20 percent more in fees for processing raw material concentrate next year as mine supply increases, executives at smelters as well as traders said.

Also weighing on copper, two of China's biggest banks reported sharply higher bad loans for the third quarter on Wednesday, and one added that a credit crunch squeezing small companies in the country's export-oriented eastern provinces may be spreading westwards.

In positive news for zinc, which is used in galvanising, national operator China Railway Corporation said all 64 railway projects planned for this year had been approved and would start by the end of the year.

Zinc fell by 0.10 percent to $2,293 a tonne while nickel - which had leapt more than 7 percent by early on Wednesday - gave back 1.53 percent to $15,430 a tonne.

Copyright Reuters, 2014

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s.rs96@yahoo.com (Shoaib-ur-Rehman Siddiqui)EuropeThu, 30 Oct 2014 11:48:35 +0000
Gold steadies as investors expect cautious stance by Fedhttp://www.brecorder.com/markets/commodities/europe/202276-gold-steadies-as-investors-expect-cautious-stance-by-fed.htmlhttp://www.brecorder.com/markets/commodities/europe/202276-gold-steadies-as-investors-expect-cautious-stance-by-fed.htmlimageLONDON: Gold steadied near $1,230 an ounce on Wednesday as investors awaited guidance from the U.S. Federal Reserve, widely expecting it to reaffirm willingness to wait for an extended period before raising interest rates.

The Fed, which wraps up a two-day policy meeting later on Wednesday, is widely expected to end its two-year-old bond-buying stimulus, known as quantitative easing, as the U.S. economy gathers momentum.

Fed officials have also stressed, however, that they are in no hurry to take tightening a step further by raising rates from near zero levels, citing subdued inflation and the poor quality of a recovery in labour markets.

Gold has benefited from the low interest rates and increased liquidity that have dominated central bank policy in the years after the 2008 financial crisis.

Keeping U.S. interest rates lower for a longer period bodes well for a non-interest bearing asset such as gold.

Spot gold was unchanged at $1,228.00 an ounce by 1045 GMT after edging higher on Tuesday. The metal reached a six-week high of $1,245 last week.

U.S. gold futures were down $2.50 an ounce at $1,227.00.

"This should be the end of QE, but if some wording is used by the Fed that the economic recovery doesn't justify removal of its monetary stimulus and they have ... to leave the door open to reinstating some measures in the future, then that could be interpreted as fairly positive for gold," Mitsubishi Corp strategist Jonathan Butler said.

"As long as the economic picture still looks fairly unclear, the Fed will adopt a reasonably cautious stance."

The dollar was unchanged against a basket of leading currencies, having slipped in the previous session after weak economic data, which gives the U.S. central bank reason to hold off from tightening its monetary policy.

Demand for U.S.-made capital goods fell the most in eight months in September, while the housing sector also remained largely soft.

CHINA THREAT

Weakness in demand from China, the world's biggest consumer of gold, remains a key threat to any price upside.

"To me the most important thing is that Chinese buyers have been absent for most of this year, and that hasn't supported the price of gold," said Victor Thianpiriya, an analyst at Australia and New Zealand Banking Group.

In 2013, China imported a record 1,158.162 tonnes of gold from Hong Kong, the main conduit for gold into the mainland, spurred by a 28 percent drop in global prices.

But demand has since waned with gold prices largely steady this year.

"Tactically, we still view gold rallies as short-lived and favour approaching gold from the short side. Support is still resilient around $1,180. We expect physical demand to increase in strength on approach of this level," Standard Bank said in a note.

Elsewhere, Russia increased its gold reserves for a sixth straight month in September, while Azerbaijan added to its holdings for a second month, according to data from the International Monetary Fund.

Among the other precious metals, spot silver was up 0.1 percent at $17.17 an ounce. Platinum was up 0.4 percent at $1,265.70 an ounce, while palladium rose 0.7 percent to $795.00 an ounce.

Copyright Reuters, 2014

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imad_kueconomist@yahoo.com (Imaduddin)EuropeWed, 29 Oct 2014 12:24:41 +0000
Gold firms on weak US durable goods data; Fed eyedhttp://www.brecorder.com/markets/commodities/europe/202192-gold-firms-on-weak-us-durable-goods-data;-fed-eyed.htmlhttp://www.brecorder.com/markets/commodities/europe/202192-gold-firms-on-weak-us-durable-goods-data;-fed-eyed.html

imageNEW YORK/LONDON: Gold prices edged higher on Tuesday as softer-than-expected US consumer spending data pressured the dollar, ahead of a closely-watched Federal Reserve policy statement.

Data showed demand for US-made non-defence durable goods, excluding aircraft, fell 1.7 percent in September, its biggest drop in eight months and a cautionary note for an economy that otherwise seems to be moving forward at a steady clip.

Investors are focusing on the Fed's latest policy statement on Wednesday afternoon, when the US central bank will likely reinforce its stated willingness to wait for a long while before hiking interest rates, after a volatile month in financial markets.

"The rally after today's durable goods number is somewhat reassuring the Fed meeting this week will not have any unusual language in reversing its continued low interest rates policy," said George Gero, vice president of RBC Capital Markets in New York.

A delay in any rate rise could boost gold, a non-interest-bearing asset.

Spot gold was up 0.3 percent at $1,228.47 an ounce by 2:49 p.m. EDT (1849 GMT), having earlier hit a two-week low of 1,222.20 an ounce.

US COMEX gold futures for December delivery settled up 10 cents an ounce at $1,229.40, with volume in line with their 30-day average, preliminary Reuters data shows.

Gold's gains are limited as the S&P 500 equities index rose and as US data also showed consumer confidence surged to a seven-year high in October.

The Fed is also expected to announce the end of its five-year bond-buying stimulus program, known as quantitative easing (QE).

Analysts said that may have already been priced in even though the end of economic stimulus is clearly bearish for gold, a traditional inflation hedge.

Gold prices are also underpinned by decent physical demand.

The US Mint has sold nearly 60,000 ounces of American Eagle gold coins so far in October, its highest monthly sales since January, boosted by heightened geopolitical uncertainty and better interest from Asian and European retail investors.

Silver climbed 0.7 percent to $17.20 an ounce.

Investor interest in silver remains soft, however. Outflows from silver-backed exchange-traded funds were 11.51 million ounces in October, the largest monthly decline since May last year, UBS said in a note.

Platinum was up 1 percent at $1,260.40 an ounce and palladium climbed 1.8 percent to $790.70, having earlier hit a near-three-week high at $798 an ounce.

A potential "death cross" on palladium's daily chart suggests the autocatalyst metal's price is vulnerable to resuming a slide, analysts said.

Copyright Reuters, 2014

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s.rs96@yahoo.com (Shoaib-ur-Rehman Siddiqui)EuropeWed, 29 Oct 2014 04:32:57 +0000