Gold steady after 1 percent fall, stimulus concerns linger

SINGAPORE (Reuters) - Gold was steady on Wednesday after a sharp slide the day before prompted by fears the U.S. Federal Reserve would begin tapering its stimulus programme from next month.

FUNDAMENTALS

Spot gold had risen 0.08 percent to $1,321.76 an ounce by 0010 GMT, after dropping 1.1 percent on Tuesday and snapping a four-day climb.

U.S. retail sales rose in July, pointing to an acceleration in consumer spending that could bolster the case at the Fed for winding down its major economic stimulus.

The Fed could begin reducing its bond-buying stimulus as early as its September meeting despite inflation being below target, Atlanta Fed President Dennis Lockhart said on Tuesday.

The value of Russia's gold and foreign exchange reserves fell $13.9 billion in the second quarter to $513.8 billion, mostly due to a slide in gold prices, the country's central bank said.

India hiked the import duty on gold yet again to a record 10 percent and also raised excise duty on the metal, after Indians bought more in July despite attempts to strangle supply and curb demand as the government tries to rein in dollar spending.

Gold prices in India are likely to rise this week, extending gains past their highest level in four months, due to the import duty hike and dollar weakness.

(Reporting by A. Ananthalakshmi; Editing by Joseph Radford)