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Gold holds gains as U.S. political worries hit dollar

Reuters 

- Gold prices held steady on Thursday after jumping about 2 percent the session before, buoyed by political uncertainty in the United States and tempered expectations for an aggressive string of U.S. hikes.

FUNDAMENTALS

* Spot gold was flat at $1,259.99 per ounce by 0055 GMT, after earlier touching its strongest since May 1 at $1,263.02. It rose about 2 percent on Wednesday in its biggest one-day percentage gain since June last year.

* U.S. gold futures were up 0.1 percent at $1,260 an ounce.

* The dollar stood near six-month lows against a basket of major currencies on Thursday as the U.S. political crisis appeared to deepen, and likely to delay any efforts by President Donald Trump to carry out his economic stimulus plans. [USD/]

* The U.S. Justice Department on Wednesday appointed former FBI Director Robert Mueller as special counsel to investigate possible collusion between Trump's 2016 campaign team and Russia as well as alleged Russian interference in the U.S. election.

* Investors were shelving rosy hopes for U.S. tax reform and rethinking strategies premised o Trump's economic growth promises on Wednesday, as the President faced his loudest criticism yet over possible collusion between his election campaign and Russia.

* Minneapolis Federal Reserve Bank President Neel Kashkari on Wednesday warned against using hikes to address unwanted asset bubbles, saying that bubbles are hard to identify and such hikes would likely do more harm than good.

* U.S. mortgage application activity recorded its steepest drop since December, retreating from an eight-week high, as various home borrowing costs held steady or rose modestly, according to Mortgage Bankers Association data released on Wednesday.

* UBS's U.S. economists on Wednesday said they expected the Fed to increase interest rates at its June and September policy meetings, earlier than their prior forecast on such moves at their July and December meetings.

* Indian gold imports will drop back sharply after jumping in the first quarter, the World Gold Council said on Wednesday as the launch of a new tax regime and restrictions on refiners' ability to import gold dore take their toll.

* South Africa's platinum output is grinding lower as producers cut capital expenditure and shutter unprofitable areas, but it is not happening fast enough to tackle the industry's bigger problem - rock-bottom prices for the metal itself.

(Reporting by Vijaykumar Vedala in Bengaluru; Editing by Joseph Radford)

(This story has not been edited by Business Standard staff and is auto-generated from a syndicated feed.)

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