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Gold steady ahead of Fed minutes, stimulus outlook

Source : REUTERS
Last Updated: Tue, Aug 20, 2013 04:11 hrs
A saleswoman displays a gold necklace at a jewellery showroom in Kolkata

Gold was steady on Tuesday as traders waited for clues on the outlook for U.S. stimulus from the minutes of the Federal Reserve's July policy meeting, due for release on Wednesday.

FUNDAMENTALS

Spot gold had risen 0.1 percent to $1,367.14 an ounce by 0007 GMT. It fell on Monday, snapping a three-day winning streak as rising U.S. bond yields signalled the Fed could be moving closer to reducing its bond-buying programme next month.

SPDR Gold Trust, the world's largest gold-backed exchange-traded fund, said its holdings fell 0.33 percent to 912.32 tonnes on Monday, after seeing its first weekly increase since November 2012.

Britain's gold exports to Switzerland surged in the first half of this year, Australian bank Macquarie said on Monday, suggesting bullion being sold out of exchange-traded funds may be heading for Swiss refineries before being sold on in Asia.

Indian traders said they would start importing gold again over the next week or so after the central bank clarified a new rule that brought the flow of the precious metal into the world's top gold consumer to a standstill at the end of July.

The cost structure at AngloGold Ashanti's flagship Ghana gold mine is unsustainable and the company is looking to make cuts to counter rising costs and falling production, the firm's chief executive said.

Anglo American Platinum (Amplats), the world's top platinum producer, said it planned almost 7,000 job cuts at its South African operations including thousands of compulsory lay-offs, drawing an angry response from a labour union and raising the risk of renewed unrest at its mines.

Platinum producer Lonmin faces possible strike action from minority unions that were left out of a recognition agreement it signed last week with South Africa's hardline Association of Mineworkers and Construction Union.

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MARKET NEWS

U.S. benchmark bond yields hit a two-year high near 3 percent on Monday and emerging market currencies from India to Indonesia tumbled as markets braced for the Fed to start withdrawing support for the U.S. economy.

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