Gold prices ease as US dollar regains some ground
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Gold prices edged lower on Tuesday as a steady dollar made bullion more expensive for overseas buyers, while softer U.S. economic data heightened expectations of less-aggressive moves by the Federal Reserve.
FUNDAMENTALS
* Spot gold was down 0.1% at $1,962.36 per ounce, as of 0103 GMT. U.S. gold futures were flat at $1,999.50.
* The dollar index was 0.1% higher. [USD/]
* Gold prices had dropped on Monday after a surprise cut in OPEC+ crude production was announced during the weekend. But prices reversed course to rally 1% as the dollar stumbled following the release of softer U.S. economic data.
* Data showed U.S. manufacturing activity slumped to the lowest level in nearly three years in March as new orders continued to contract, and activity could decline further amid tightening credit conditions.
* U.S. Treasury Secretary Janet Yellen said a surprise OPEC+ oil production cut is an "unconstructive act" that will add uncertainty to the global growth outlook.
* While gold is traditionally considered a hedge against inflation, higher interest rates to rein in rising price pressures dim the appeal for non-yielding bullion.
* Markets see a 54.8% chance of the Fed hiking rates by a quarter point in May, according to the CME FedWatch tool.
* SPDR Gold Trust, the world's largest gold-backed exchange-traded fund, said its holdings rose 0.22% to 930.04 tonnes on Monday from 928.02 tonnes on Friday. [GOL/ETF]
* Spot silver fell 0.3% to $23.92 per ounce, while platinum edged up 0.2% to $987.92 and palladium rose 0.2% to $1,462.09.
DATA/EVENTS (GMT)
0430 Australia RBA Cash Rate April
1400 US Factory Orders MM Feb
