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Gold edges higher in narrow trade, markets seek fresh cues

Kitco News

*U.S. jobless claims data due at 1330 GMT
*Spot gold headed for a 8.8% quarterly gain
*Some optimism in gold market heading into 2023 - analyst

Dec 29 (Reuters) - Gold edged higher on Thursday helped by a dip in the dollar and U.S. Treasury yields, although prices moved in a tight range as investors refrained from making large bets in anticipation of fresh market drivers.

Spot gold rose 0.1% to $1,806.44 per ounce by 1258 GMT, while U.S. gold futures were down 0.1% to $1,813.70.

"The U.S. jobless data later today will be scrutinised for its possible impact on the Fed strategy with a below expectation reading likely triggering a decline in the dollar and by extension gold should benefit to the upside," said independent analyst Ross Norman.

Spot gold was also headed for an 8.8% quarterly gain, with prices up nearly $200 from a more than two-year low hit in September on hopes of the U.S. central bank slowing its pace of interest rate hikes.

"There seems to be some optimism for gold as we head towards the new year. The market appears well supported at its 200-day moving average at $1,782 and encouragingly for gold bulls, silver is outperforming as this is often a good indicator of a move higher in the entire metals complex," Norman added.

Helping gold eke out gains, the dollar index dipped 0.3%, while benchmark U.S. 10-year Treasury yields eased after hitting a six-week high in the previous session.

A peak in the U.S. dollar and rates seems likely over the next three to six months, while physical consumption for both gold and silver, particularly from Asia, has been much stronger in the second half of this year than consensus projections, Citi analysts said in a note.

"While a deep US and/or global recession could pose some risk for silver industrial demand, financial gold consumption and central bank demand should stay steady next year."

Elsewhere, spot silver rose 1.3% to $23.83 per ounce, platinum gained 0.7% to $1,014.61, while palladium dipped nearly 1% to $1,766.13.

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