Please use symbol entry at top right of page to search

PRECIOUS-Gold slips on dollar gains as Powell doubles down on policy tightening

       * Dollar index        up 0.3%
    * Weekly jobless claims fall 2,000 to 229,000
    * Silver bars pile up at Russia's Polymetal
    * U.S Treasury yields tumble to two-week lows

 (Updates prices)
    By Ashitha Shivaprasad
    June 23 (Reuters) - Gold gave up initial gains and edged
lower on Thursday as the dollar regained momentum after U.S.
Federal Reserve Chairman Jerome Powell doubled down on the
central bank's policy tightening aimed at taming inflation.
    Spot gold        fell 0.8% to $1,822.64 per ounce by 2:28
p.m.m ET (1828 GMT). U.S. gold futures        settled down 0.5%
to $1,829.8.
    After Powell said the Fed's commitment to curbing inflation
was "unconditional", the dollar index        resumed its uptick,
dimming gold's appeal. A stronger dollar makes gold expensive
for overseas buyers.
    While gold is considered a hedge against inflation and
economic uncertainties, rising interest rates tend to lift bond
yields and thus increase the opportunity cost of holding
zero-yield bullion.
    Gold is being pressured by the aggressive nature of the
Fed's tightening strategy, with the dollar gains also an
impediment, said Jim Wyckoff, senior analyst at Kitco Metals.
    The gold and silver markets were also being weighed down by
expectations that the overall economic slowdown could also
hamper demand for metals, although "gold's safe haven status is
limiting the downside", Wycoff added.
    Meanwhile, U.S. yields fell to their lowest in almost two
weeks, while fears about an economic slowdown continued to mount
as Powell indicated that the Fed's fight against inflation may
come at the cost of rising unemployment.
    Investors also took stock of data showing a dip in U.S.
weekly jobless claims last week as labor market conditions
remained tight. Meanwhile, U.S. business activity slowed
considerably in June, a survey showed.
    Bank of China International analyst Xiao Fu said while gold
will attract buyers due to recession risks, rising rates could
significantly impact asset classes, including gold.
    Spot silver        fell 2.2% to $20.92 per ounce, platinum
       was down 2.4% at $904.60 and palladium        fell 1% to

 (Reporting by Ashitha Shivaprasad and Arundhati Sarkar in
Bengaluru; editing by David Evans, Shinjini Ganguli and Vinay

Copyright © Reuters 2008. All rights reserved. Republication or redistribution of Reuters content, including by caching, framing or similar means, is expressly prohibited without the prior written consent of Reuters. Reuters and the Reuters sphere logo are registered trademarks and trademarks of the Reuters group of companies around the world.

News, commentary and research reports are from third-party sources unaffiliated with Fidelity. Fidelity does not endorse or adopt their content. Fidelity makes no guarantees that information supplied is accurate, complete, or timely, and does not provide any warranties regarding results obtained from their use.