* Eyes also on key data including ISM, jobs report from U.S.
* SPDR Gold holdings <XAUEXT-NYS-TT> fall 0.46 pct on Tuesday
By Risa Maeda
TOKYO, July 1 (Reuters) - Gold edged higher on Wednesday,
taking a breather after falling more than 1 percent the previous
day when a stronger dollar prompted broad-based selling across
the commodities sector.
The dollar is likely to stay a key driver for gold in the
near term and the strength it derives from risk-averse investor
demand is expected to be tested by upcoming data including
Wednesday's U.S. manufacturing report by the Institute for Supply
Management and Thursday's U.S. payrolls report, traders said.
Spot gold <XAU=> rose to a high of $929.85 an ounce before
trading at $928.20 at 0540 GMT, up 0.3 percent from New York's
notional close of $925.85.
Bullion hit a two-week high of $948.20 late last week.
U.S. gold futures for August delivery <GCQ9> were at $928.80
an ounce, up 0.2 percent from the previous settlement on the
COMEX division of the New York Mercantile Exchange.
On Tuesday, gold bullion fell as low as $922.60, the lowest
since June 24, as the dollar recovered <.DXY> after an unexpected
drop in U.S. consumer confidence data.
"My thoughts are that gold is likely to remain rangebound for
this week," said Adrian Koh, an analyst at Phillip Futures in
Singapore.
Although investors are set to scrutinise upcoming data as
trading cues for the dollar and gold, the precious metal is
likely to stay within a range of $900 to $950, he said.
Investors consider gold as insurance against the falling
value of dollar-denominated portfolios.
The dollar was up 0.4 percent against the yen <JPY=> and
steady against the euro <EUR=>, helping to keep a cap on gold
prices.
Reflecting investors' receding appetite for gold, holdings by
the world's largest gold-backed exchange-traded fund, the SPDR
Gold Trust <GLD>, fell again on Tuesday. []
Its holdings stood at 1,120.55 tonnes as of June 30, down
5.19 tonnes or 0.46 percent from the previous business day. The
holdings are down 13.48 tonnes from a record high marked on June
1.
Holdings in the trust, which issues securities backed by
physical stocks of gold, have declined in the past few weeks as
growing optimism about the global economy sapped investors'
appetite for bullion as a safe-haven asset. <XAUEXT-NYS-TT>.
Also, a reversal in a rally in global stock markets has eased
inflation concerns and reduced its appeal as a hedge against
rising prices.
"We should look at the U.S. jobs report first before making
any decision. If there are signs of inflation and stocks move
higher afterwards, that would be a plus for gold," said a manager
at a Japanese trading firm.
The Bank of Japan's quarterly tankan survey showed Japanese
business morale improved less than expected in June, plagued by
doubts about the global economy. []
Precious metals prices at 0548 GMT
Metal Last Change Pct chg YTD pct chg Turnover
Spot Gold 928.15 2.30 +0.25 5.45
Spot Silver 13.60 0.03 +0.22 20.14
Spot Platinum 1168.50 -4.00 -0.34 25.38
Spot Palladium 247.00 -1.00 -0.40 33.88
TOCOM Gold 2897.00 -21.00 -0.72 12.59 25988
TOCOM Platinum 3656.00 -55.00 -1.48 37.86 9494
TOCOM Silver 423.20 -14.80 -3.38 32.54 334
TOCOM Palladium 773.00 -8.00 -1.02 40.55 166
Euro/Dollar 1.4030
Dollar/Yen 96.74
TOCOM prices in yen per gram, except TOCOM silver which is
priced in yen per 10 grams. Spot prices in $ per ounce.
(Additional reporting by Chikako Mogi)
