October 02, 2017
PRECIOUS-Gold drops to lowest in nearly 7 weeks; stronger dollar, equities weigh
(Reuters) - Gold slipped to its lowest in nearly seven weeks early on Monday as the U.S. dollar rose and equities gained, while growing expectations for a Federal Reserve interest rate hike in December also dragged on prices.
Spot gold was down 0.2 percent at $1,276.47 an ounce by 0042 GMT, after earlier touching its lowest since mid- August at $1273.90.
The metal recorded its biggest monthly decline so far this year in September.
U.S. gold futures for December delivery shed 0.5 percent to $1,278.90 per ounce.
MSCI's broadest index of Asia-Pacific shares outside Japan was up 0.2 percent.
The dollar edged up 0.1 percent against a basket of major currencies and gained 0.2 percent versus the yen.
U.S. President Donald Trump on Sunday dismissed the prospect of talks with North Korea as a waste of time a day after his own secretary of state said the United States was maintaining open lines of communication with North Korean leader Kim Jong Un.
The United States said on Saturday it was directly communicating with North Korea on its nuclear and missile programmes but Pyongyang had shown no interest in dialogue.
U.S. President Donald Trump is ramping up his search for a new chief for the U.S. central bank, promising a decision next month.
Philadelphia Fed President Patrick Harker said Friday he still has "pencilled in" an interest rate hike in December, and three more rate hikes next year, in line with most of his colleagues at the central bank.
U.S. consumer spending barely rose in August likely as Hurricane Harvey weighed on auto sales, while annual inflation increased at its slowest pace in nearly two years, pointing to a moderation in economic growth in the third quarter.
Euro zone inflation undershot expectations in September, Eurostat data showed on Friday, highlighting that price growth remained week and supporting the European Central Bank's case for only gradual removal of stimulus.
Britain's economy grew at its slowest pace since 2013 in the 12 months after last year's Brexit vote, data showed on Friday, painting a subdued picture as the Bank of England prepares to raise interest rates for the first time in a decade.