June 8, 2012 / 12:47 AM / 6 years ago

Precious: Gold pauses after tumbling on Fed disappointment

SINGAPORE (Reuters) - Gold traded little changed on Friday following a sharp sell-off in the previous session after U.S. central bank chief gave no hint on imminent stimulus, disappointing investors and dampening gold’s appeal as a hedge against monetary easing.

FUNDAMENTALS

* Spot gold was nearly flat at $1,588.06 an ounce by 0023 GMT, on course for a weekly decline of more than 2 percent. It dropped nearly 2 percent in the previous session.

* U.S. gold futures contract for August delivery edged up 0.1 percent to $1,589.70.

* U.S. Federal Reserve Chairman Ben Bernanke disappointed gold bugs on Thursday by offering few clues that further monetary easing was imminent, but said the central bank was ready to shield the economy if financial troubles mount.

* China announced a surprise interest rate cut to combat faltering growth, underlining concern among policymakers worldwide that the euro zone’s deepening crisis is threatening the health of the global economy.

* Chancellor Angela Merkel said Europe was ready to act to ensure stability in the euro zone as Spain’s credit rating was cut by three notches on Thursday amid expectations it may soon seek EU help for banks beset by bad debts.

* The Fitch downgrade came after a better-than-expected Spanish bond auction, which helped push 10-year Spanish yields back down to 6 percent. <GVD/EUR>

* For the top stories on metals and other news, click <TOP/MTL>, <TOP/MACRO> or <GOL/>

MARKET NEWS

* The S&P 500 ended barely changed on Thursday as optimism about China’s interest-rate cut was offset by Federal Reserve Chairman Ben Bernanke’s comments that dimmed hopes for more U.S. stimulus. .N

* The euro and commodity currencies nursed modest losses on Friday, having seen gains sparked by a surprise Chinese interest rate cut quickly evaporate after the U.S. central bank offered no hint of imminent monetary stimulus. <USD/>

DATA/EVENTS 0600 Germany Trade data April 0800 Italy Industrial output yy WDA April 1230 U.S. International trade April 1400 U.S. Wholesale trade April 1930 U.S. CFTC commitment of traders data Weekly

PRICES

Precious metals prices 0023 GMT

Metal Last Change Pct chg YTD pct chg Volume

Spot Gold 1588.06 -1.09 -0.07 1.55

Spot Silver 28.57 -0.01 -0.03 3.18

Spot Platinum 1438.99 4.84 +0.34 3.30

Spot Palladium 622.47 3.99 +0.65 -4.60

COMEX GOLD AUG2 1589.70 1.70 +0.11 1.46 1485

COMEX SILVER JUL2 28.53 0.00 +0.00 2.20 503

Euro/Dollar 1.2547

Dollar/Yen 79.62

COMEX gold and silver contracts show the most active months

Reporting by Rujun Shen; editing by Miral Fahmy

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