×

PRECIOUS-Gold firm as market awaits Fed policy cues

May 24 (Reuters) - Gold held steady early on Wednesday, after falling 0.7 percent in the previous session, as investors waited for cues on the U.S. Federal Reserve's rate hike stance from minutes of the central bank's latest meeting, due later in the day.

FUNDAMENTALS

* Spot gold was up 0.1 percent at $1,252.32 per ounce by 0057 GMT.

* U.S. gold futures shed 0.3 percent at $1,252.1 an ounce.

* The dollar held firm early on Wednesday, having rebounded from 6-1/2-month lows against its major peers.

* A U.S. interest rate hike next month is a "distinct possibility," the head of the Federal Reserve Bank of Philadelphia, Patrick Harker, said on Tuesday, adding that another disappointing reading on monthly inflation could cause the U.S. central bank to hold back.

* Minneapolis Federal Reserve Bank President Neel Kashkari said Tuesday that while the U.S. economy is closer now than it was in March to full employment, he still does not know "if we are there yet," and that the recent decline in core inflation is "concerning."

* U.S. President Donald Trump asked lawmakers on Tuesday to cut $3.6 trillion in government spending over the next decade, taking aim at healthcare and food assistance programs for the poor in an austere budget that also boosts the military.

* Former CIA director John Brennan said on Tuesday he had noticed contacts between associates of Trump's presidential campaign and Russia during the 2016 election and grew concerned Moscow had sought to lure Americans down "a treasonous path."

* New U.S. single-family home sales tumbled from near a 9-1/2-year high in April, but the housing recovery likely remains intact amid a tightening labor market.

* Soldiers will be deployed to key sites in Britain to boost security as the country raised its terror threat to the highest level of "critical" following a suicide attack in Manchester that killed 22 people, including children.

* Holdings in SPDR Gold Trust , the world's largest gold-backed exchange-traded fund, fell 0.59 percent to 847.45 tonnes on Tuesday.

* India's gold imports could plunge in 2017 during the traditional period of peak demand in the second half of the year, after jewelers have aggressively restocked inventory ahead of a national sales tax that takes effect on July 1.

DATA/EVENT AHEAD (GMT) 0600 Germany GfK consumer sentiment Jun

1300 U.S. Monthly home price index Mar

1345 European Central Bank President Mario Draghi speaks at First Conference on Financial Stability 1400 U.S. Existing home sales Apr 1800 Federal Reserve to release minutes of May 2-3 meeting

(Reporting by Vijaykumar Vedala in Bengaluru; Editing by Sonali Paul)