Gold price slips as dollar benefits from ECB bond-buying extension

New York (Oct 27)  Gold prices touched their lowest point in nearly three weeks on Friday as the euro slipped against the dollar following the European Central Bank's
extension of its bond-buying programme.

Currency investors played a diverging monetary policy outlook, with the U.S. expected to raise interest rates again before the end of 2017 while Europe is not now expected to do so
in the coming years.            
Spot gold touched a low of $1,264.15 per ounce, its worst since Oct. 6, and although it was 0.1 percent higher at $1,268.50 by 1005 GMT it was still heading for its second weekly decline.

U.S. gold futures for December delivery gave up 0.1 percent to $1,267.90. "How gold finishes the week will now be entirely at the whim of the U.S. dollar and U.S. yields, with little to no
geopolitical safe-haven premium left in the price," Jeffrey Halley, a senior market analyst with OANDA, said in a note.

The dollar traded at three month highs against a basket of
major currencies, adding pressure on gold as it makes
dollar-priced commodities costlier for non-U.S. investors.
    "It looks like we are going to be heading a bit lower from
here, from both the fundamental and technical points of view,"
said INTL FCStone analyst Edward Meir.
    Meanwhile, President Donald Trump's search for the next Fed
chair has come down to Fed Governor Jerome Powell and Stanford
University economist John Taylor, Politico on Thursday cited one
source as saying, while another counselled caution.            
    "The market is not pricing in more aggressive rate hike from
the Fed even given a potential change in leadership next year.
We are likely to see the same rate hike path," ETF Securities'
Martin Arnold said.
    Meanwhile, the U.S. House of Representatives helped pave the
way on Thursday for deep tax cuts sought by Trump and Republican
leaders, underpinning the greenback.            
    Holdings of the world's largest gold-backed exchange-traded
fund, New York-listed SPDR Gold Shares      , fell by 1.2 tonnes
on Thursday, data from the fund showed, its first outflow in
more than two weeks.            
    Silver prices were slightly softer at $16.73 per
ounce, platinum  dipped 0.1 percent to $913.60, while
palladium  also slipped 0.2 percent to $967. All three
metals were on track for weekly declines.

Reuters