Off The Wire
Gold gains, focus shifts to central bank policy meetings
* ECB meeting Thursday, Fed next week
* Fundamental backdrop still broadly gold supportive -analyst
* Gold set to snap four-day losing streak
* Palladium hits two-month high (Updates prices)
By Brijesh Patel Sept 11 (Reuters) - Gold rose on Wednesday, supported by lingering concerns over the global economy and U.S.-China trade tensions, but still held close to a four-week low touched last session amid a broader uptick in risk-sentiment ahead of major central bank meetings.
Spot gold was up 0.5% at $1,492.50 per ounce as of 1246 GMT. Prices fell to their lowest since Aug. 13 at $1,483.90 in the previous session. U.S. gold futures edged 0.1% higher to $1,500.50 an ounce. "Prices are up very marginally, gold is still under pressure.
We are at a month low around the $1,490 level because of improvement in risk appetite," Capital Economics analyst Ross Strachan said. "The fact that we are at the bottom end of the range over the past month or so is attracting some interest, but we are also seeing partial recovery in bond yields in recent days, which is a bearish factor for gold in the short term,"
Ross added. Bond yields climbed and world stocks rose for a sixth straight day, ahead of monetary policy decisions by the European Central Bank on Thursday, when the bank is widely expected to cut interest rates.
The ECB decision is likely to set the tone for upcoming rate-setting decisions by the U.S. Federal Reserve and the Bank of Japan next week. "The overall fundamental backdrop is probably still broadly gold-supportive considering the main sources of risk aversion remain unresolved," said Ilya Spivak, senior currency strategist at DailyFx.
"Both Brexit and the U.S.-China trade war are ongoing concerns, as is the broader slowdown in global growth. That probably encourages central banks to remain dovish, weighing on yields and boosting gold."
Lower interest rates decrease the opportunity cost of holding non-yielding bullion and weigh on the dollar, making gold cheaper for investors holding other currencies.
Meanwhile, the dollar was up 0.2% on Wednesday against a basket of major currencies. On the trade front, a senior White House adviser on Tuesday played down expectations for the next rounds of U.S.-China trade talks, urging investors, businesses and the public to be patient about resolving the protracted dispute.
Spot gold is still targeting $1,453, as it has breached a support at $1,497 per ounce, according to Reuters technical analyst Wang Tao. Among other precious metals, silver gained 0.6% to $18.11 per ounce, having hit a two-week low of $17.75 in the previous session.
Palladium climbed 1.2% to $1,579.89 an ounce, after hitting its highest since July 11 at $1,585. Platinum rose 1.1% to $940.50. (Reporting by Brijesh Patel in Bengaluru; Editing by Mark Potter, Steve Orlofsky and Uttaresh.V)
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