Gold holds losses as dollar gains versus yen

REUTERS - Gold held on to its losses early on Wednesday after falling 0.6 percent the session before, with the dollar advancing versus the yen.

FUNDAMENTALS

* Spot gold was down 0.1 percent at $1,316.90 an ounce by 0105 GMT.

* U.S. gold futures eased 0.1 percent to $1,321.90 an ounce.

* The Bank of Japan plans to make its controversial negative interest rate policy the centrepiece of future monetary easing, promising to weigh further cuts as expansions to asset buying near their limits, the Nikkei newspaper reported on Wednesday.

* The dollar stood atop sizeable gains versus the yen early on Wednesday. The greenback was up 0.3 percent at 102.82 yen, after touching a one-week high of 102.87.

* The 10-year U.S. Treasury yield rose to a three-month high of 1.752 percent, having risen more than 20 basis points from a week ago.

* U.S. household income posted a record increase in 2015 after years of stagnation, suggesting the recovery from the Great Recession was finally lifting ordinary citizens who had been largely left behind.

* China's factory output and retail sales grew faster than expected in August as a strong housing market and a government infrastructure spending spree underpinned growth in the world's second-largest economy.

* Holdings of SPDR Gold Trust, the world's largest gold-backed exchange-traded fund, fell 0.47 percent to 935.49 tonnes on Tuesday.

MARKET REPORT

* Asian shares wallowed near six-week lows on Wednesday, bruised by a fall in oil prices on renewed worries about a supply glut.

* Oil prices dropped as much as 3 percent on Tuesday after both the world's energy watchdog and OPEC revised forecasts that signalled the global crude glut could persist for much longer than expected.

DATA/EVENT AHEAD (GMT)

0900 Euro zone Industrial production July 1230 U.S. Import prices August 1230 U.S. Export prices August

(Reporting by Swati Verma in Bengaluru; Editing by Joseph Radford)