Gold dips after short-covering rally on stronger dollar

Singapore (Nov 17)  Gold came under pressure early on Monday as the dollar jumped to a seven-year high against the yen, but the metal managed to hold most of the previous
session's short-covering gains.
   
 FUNDAMENTALS
 * Spot gold had eased 0.2 percent to $1,185.14 an ounce by 0032 GMT, after jumping 2.3 percent on Friday, when it also hit a two-week high of $1,193.34.
 * The gains on Friday, despite strong U.S. economic data on retail sales and consumer sentiment, were from a short-covering rally after bullion marked 4-1/2-year lows earlier in the month.
* A stronger greenback and economic optimism could keep gold's gains in check as the metal is often seen as an alternative investment. A robust economy could also prompt the
U.S. Federal Reserve to soon raise interest rates, hurting non-interest-bearing gold.   
* Bearish sentiment in the market prevailed. Hedge funds and
money managers in gold futures and options slashed their long
bets for a third straight week to their least bullish in a
month, according to the Commodity Futures Trading Commission.
 
    * Hedge fund Paulson & Co maintained its stake in the
world's biggest gold-backed exchange-traded fund, SPDR Gold
Trust, in the third quarter, but legendary investor George
Soros has sharply cut his stake in Barrick Gold Corp and several
gold mining company ETFs.
    * The Swiss National Bank repeated its opposition to a
referendum on boosting gold reserves on Saturday, saying a
yes-vote would put at risk its efforts to rein in the red-hot
franc against the euro for as long as necessary.
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    MARKET NEWS
    * The dollar surged to a fresh seven-year high against the
yen on Monday after Japan's third quarter GDP unexpectedly
contracted, giving the Japanese prime minister a strong excuse
to call a snap election and delay a planned sales tax hike.
   

Source:  Reuters