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Gold prices drift higher on US rate-cut optimism



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Aug 6 (Reuters) -Gold prices edged higher on Tuesday from multi-week lows after U.S. central bank policymakers did their best to reassure markets and highlighted the prospect of a September interest rate cut.


FUNDAMENTALS

* Spot gold XAU= was up 0.2% at $2,411.97 per ounce, as of 0200 GMT. U.S. gold futures GCcv1 rose 0.3% to $2,452.60.

* Bullion marked its worst day in nearly two weeks in the previous session, caught in the slipstream of a global, wider market sell-off amid mounting economic concerns.

* U.S. central bank policymakers pushed back on Monday against the notion that weaker-than-expected July jobs data means the economy is in recessionary freefall, but also warned that the Federal Reserve will need to cut rates to avoid such an outcome.

* Fed San Francisco President Mary Daly said her mind was open to cutting interest rates as necessary and policy needed to be proactive.

* Traders are pricing in a 50-basis-point cut at the Fed's September meeting, according to CME FedWatch, with an additional cut anticipated in December.

* Lower interest rates put pressure on the dollar and bond yields, which increase the appeal of non-yielding bullion

* Markets will be looking out for U.S. trade deficit data due later in the day and initial jobless claims data on Thursday.

* Data on Monday showed U.S. services sector activity rebounded from a four-year low in July amid a bounce back in new orders and the first increase in employment in six months.

* Spot silver XAG= gained 0.2% to $27.33 per ounce, platinum XPT= was up nearly 1% at $914.90.

* Palladium XPD= rose 0.8% to $856.83 after hitting on Monday its lowest levels since August 2018.


DATA/EVENTS (GMT)

0600 Germany Industrial Orders MM June

0600 Germany Manufacturing O/P Cur Price SA June

0600 Germany Consumer Goods SA June

0830 UK S&P Global PMI: MSC Composite - Output July

1230 US International Trade $ June

1400 Glbl Supl Chain Prs IDX July





Reporting by Daksh Grover in Bengaluru; Editing by Sherry Jacob-Phillips

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