Gold prices barely changed, physical buying supports

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Gold traded little changed on Wednesday, as investors awaited  policy decisions. (Reuters) Gold traded little changed on Wednesday, as investors awaited policy decisions. (Reuters)
SummaryGold traded little changed on Wednesday, as investors awaited policy decisions.

Gold traded little changed on Wednesday, as investors awaited policy decisions by central banks in Japan and the euro zone, while physical buying interest from Asia helped support sentiment.

FUNDAMENTALS

* Spot gold was little changed at $1,658.24 an ounce by 0042 GMT, after rising 0.7 percent in the previous session.

* U.S. gold inched down 0.2 percent to $1,658.20.

* The Bank of Japan will consider easing monetary policy again this month as it eyes doubling its inflation target, sources say, as weakness in the economy threatens to delay the country's efforts to beat deflation.

* The Federal Reserve's latest stimulus plan will not do much to boost growth and raises the risk of inflation next year, Richmond Fed Bank President Jeffrey Lacker said on Tuesday, echoing remarks he made last week.

* Investors will closely watch the European Central Bank's policy meeting on Thursday, during which the ECB is likely to keep interest rates unchanged.

* Premiums on gold shipments to India jumped to their highest level in two months on Tuesday as traders rushed in to place orders for the metal ahead of an expected rise in import duty, even as gold refiners overseas hurried to keep pace.

* Barrick Gold Corp has ended talks on selling a stake in majority-owned African Barrick Gold to a Chinese buyer, dashing hopes of a potential $3 billion deal for the underperforming unit.

* Banks are continuing to exchange gold in Turkey, despite U.S. pressure over the country's booming gold-for-gas trade with Tehran, which helps Iran cope with international sanctions, bankers said on Tuesday.

* Holdings of iShares Silver Trust, the world's biggest silver-backed exchange-traded fund, rose to 10,112.22 tonnes on Jan 7, its highest since May 2011.

* Spot silver traded nearly flat at $30.34, after rising more than 9 percent in 2012.

MARKET NEWS

* U.S. stocks fell on Tuesday, retreating from last week's rally on the "fiscal cliff" deal in Washington, as companies started to report results for the fourth quarter.

* The yen continued to rise against the dollar and the euro in early Asian trading on Wednesday despite expectations of further easing steps from the Bank of Japan, as investors locked in gains.

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