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Gold rangebound with U.S. economic data in focus

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Gold prices consolidated in a narrow range on Thursday as cautious investors awaited U.S. economic data releases due later in the day that may influence the Federal Reserve’s interest-rate raising timeline.

Spot gold was little changed at $1,814.03 per ounce by 1118 GMT, while U.S. gold futures edged 0.1% lower to $1,823.50.

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“Thin markets are often prone to exaggerated moves on small volumes… gold looks likely to end the year with a modest gain in dollar terms in a year which many had expected a far stronger performance,” said independent analyst Ross Norman.

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“From a technical perspective gold looks quite bullish in the short term as it is holding well above key moving averages, targeting the (near) 6-month high of $1,823.”

Gold has risen about $200 since falling to a more than two-year low in late September as expectations about slower rate rises from the Fed dimmed the dollar’s charm.

While gold looks well set for now, some caution is required with it, as it could only take one or two disappointing data points for the metal to come crashing back down, said Rupert Rowling, an analyst at Kinesis Money.

U.S. gross domestic product data for the third quarter and weekly U.S. jobless claim numbers are due at 1330 GMT. Traders will also scan personal consumption expenditure (PCE) data, due on Friday, for cues on inflation.

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A couple European Central Bank policymakers joined the chorus of euro zone central bankers supporting more interest rates increases at the pace of last week’s hike to tame inflation.

Although bullion is seen as an inflation hedge, rising interest rates dent its appeal.

The U.S. dollar index eased, making precious metals less expensive for holders of other currencies.

Spot silver fell 1.3% to $23.66 per ounce, platinum was up 0.2% to $999.88, while palladium jumped 1.5% to $1,717.00. (Reporting by Arundhati Sarkar and Seher Dareen in Bengaluru; editing by Jason Neely and Krishna Chandra Eluri)

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