Gold price steady as dollar licks wounds after biggest drop since June

London (Nov 23)  Gold steadied on Thursday, having risen nearly 1 percent in the previous session, as the dollar
sank after minutes from the U.S. Federal Reserve's latest policy meeting dampened the outlook for interest rate hikes next year.

The dollar nursed losses after posting its biggest drop in five months on Wednesday after the Fed minutes showed "many
participants" were concerned inflation would stay below the bank's 2 percent target for longer than expected.      

"Gold is obviously still in need of a spark but we still see a chance of it reaching our year end target of $1,325," said Ole
Hansen, head of commodity strategy at Saxo Bank.

"The outlook for inflation is still low, long yields will remain subdued and then we have geopolitical risks rising this
year. That's enough to prompt investors to buy gold, even though the growth outlook is still strong across the world."
    Spot gold was flat at $1,292.14 per ounce by 1115 GMT.  U.S. gold futures for December delivery were flat at $1,292.
    Trading was lighter than usual on Thursday, with Japanese
financial markets shut for a public holiday. U.S. markets will
be closed for the Thanksgiving holiday.
    In wider markets, Chinese stocks suffered their biggest
slump in almost two years, taking the shine off another record
high in the global equity bull run and offering underlying
support for gold, seen as a safe haven asset.           
    Low yielding currencies such as the Japanese yen and the
Swiss Franc remained firmly supported against the dollar as
investors shied away from taking positions in a
holiday-shortened week.
    Earlier in the week, Fed Chair Janet Yellen stuck by her
prediction that U.S. inflation would soon rebound, but offered
an unusually strong caveat: she is "very uncertain" about this
and open to the possibility that prices could remain low for
years to come.
    A weaker dollar makes dollar-priced gold cheaper for
non-U.S. investors.
    Holdings of the largest gold-backed exchange-traded-fund
(ETF), New York's SPDR Gold Trust GLD, and the largest
silver-backed ETF, New York's iShares Silver Trust SLV, remained
unchanged on Wednesday from Tuesday.            
    Spot gold may test a support at $1,283 per ounce as it
failed to break resistance at $1,297, according to Reuters
technical analyst Wang Tao.             
    In other precious metals, silver slipped 0.1 percent
to $17.13 an ounce, platinum fell 0.6 percent to $933 an
ounce, while palladium was flat at $1,003 an ounce.