Gold extends gains on U.S. inflation data, focus on cenbank meetings

Dec 13 (Reuters) – Gold inched higher on Monday as elevated U.S. consumer prices lifted its appeal as an inflation hedge, while investors awaited a flurry of central bank meetings this week, including by the U.S. Federal Reserve, for further direction.


* Spot gold rose 0.2% to $1,786.51 per ounce by 0213 GMT, after Friday’s 0.8% gain. U.S. gold futures were up 0.2% to $1,787.70.

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* U.S. consumer prices increased further in November as the cost of goods and services rose broadly amid supply constraints, leading to the largest annual gain since 1982. read more

* The dollar index was quiet at the start of a week in which central bank meetings will likely drive currency markets.

* The Fed is widely expected to signal a faster tapering of asset buying this week, and thus an earlier start to rate hikes.

* The European Central Bank and the Bank of Japan are set to review their monetary policies this week.

* Reduced stimulus and interest rate hikes tend to push government bond yields up, raising the opportunity cost of holding bullion, which bears no interest.

* The European Central Bank is set to halve the amount of assets it buys each month from April, according to a Reuters poll.

* Top Asian hubs saw healthy demand for physical gold last week as domestic prices retreated into the year-end, although volatility in rates deterred retail buyers and jewellers in India.

* Spot silver rose 0.4% to $22.26 an ounce.

* Platinum was flat at $942.00 and palladium gained 1.4% to $1,786.54.

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Reporting by Asha Sistla in Bengaluru; Editing by Subhranshu Sahu

Our Standards: The Thomson Reuters Trust Principles.

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