(Corrects dollar value of gold sale in second paragraph)
* Gold a few dollars below last month's record
* IMF sells 200 tonnes of gold to India's central bank
* SPDR gold holdings unchanged at 1,103.519 T
(Updates prices, adds quotes)
By Lewa Pardomuan
SINGAPORE, Nov 3 (Reuters) - Gold rose towards last month's
record on Tuesday as the dollar slipped ahead of a U.S.
interest rate decision, and on news the IMF had completed half
of a planned gold sale.
The International Monetary Fund said on Monday it sold 200
tonnes of gold to the Reserve Bank of India for $6.7 billion,
quietly executing half of a long-planned bullion sale that had
threatened to slow gold's rally. []
Spot gold <XAU=> was quoted at $1,063.25 an ounce at 0538
GMT, up $4.10 from New York's notional close. It hit a near
two-week high of $1,066.15 on fund buying, within sight of a
lifetime high of $1,070.40 struck on Oct. 14.
"The purchase from India is positive for the spot market as
it removes a potential source of supply, as the IMF had
indicated they would sell the gold on the open market if they
do not sell it via bilateral deals directly with central
banks," said David Barclay, commodity strategist at Standard
Chartered in Hong Kong. "Indeed, drawing India in as a
buyer is fresh demand as they have not been actively building
their official reserves since the late 1990s," he added.
The IMF sale is part of an agreement struck earlier this
year among IMF member countries to sell 403.3 tonnes of the
body's gold stocks to diversify the Fund's sources of income
and to increase low-cost lending to poor countries.
U.S. gold futures for December delivery <GCZ9> added $9.9
an ounce at $1,063.90 on the COMEX division of the New York
Mercantile Exchange, within sight of last month's record of
$1,072 an ounce.
"We used to think it was all dollar related but gold seems
to behaving by itself, helped by a couple of encouraging
reports on central bank activity," said Commodity Broking
Services' Chief Executive Jonathan Barratt.
"I think if it takes out that $1,070 to $1,071 range then I
am quite happy to add positions," he added.
The U.S. dollar and the yen edged down in thin trade on
Tuesday ahead of a series of central bank meetings on interest
rates. The euro <EUR=> edged up to $1.4775, having gained 0.35
percent on Monday. []
The U.S. Federal Reserve starts its two-day meeting on
Tuesday and, while it is expected to keep rates unchanged,
there is speculation that it might drop or alter its pledge to
keep rates low for an "extended period". [].
Persistent weakness in the dollar had spurred fund buying
of gold, which sent cash and futures to record highs last
month. Gold is seen as a hedge against both inflation and a
depreciating dollar.
The world's largest gold-backed exchange-traded fund, SPDR
Gold Trust <GLD>, said its holdings stood at 1,103.519 tonnes
as of Nov. 2, unchanged from the previous business day.
[]
PRICES
Precious metals prices at 0538 GMT
Metal Last Change Pct chg Day ago pct MA 30
RSI Spot gold $1063.25 $4.10 +0.39% +18.53% $860.10
60
Spot silver $16.55 $0.12 +0.73% +38.15% $11.29
44
Spot plat $1351.00 $17.00 +1.27% +2.16% $1331.29
52
COMEX gold $1064.00 $10.00 +0.95% +1.82% $1037.62
60
Currencies
Euro/dlr $1.479 $0.002 +0.12% +0.48%
Dlr/yen 90.21 -0.12 -0.13% +0.65%
(Additional reporting by Bruce Hextall in SYDNEY; Editing by
Michael Urquhart)
