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Gold slips to near 7-week low as dollar firms

Oct 3 (Reuters) – Gold edged down to mark a near 7-week low early on Tuesday, as the dollar remained buoyed by upbeat economic data and strong U.S. treasury yields. FUNDAMENTALS * Spot gold was down 0.1 percent at $1,269.50 an ounce by 0101 GMT, after earlier touching its lowest since mid- August at $1,268.60. * U.S. gold futures for December delivery shed 0.3 percent to $1,272.50 per ounce. * The dollar on Tuesday gained 0.3 percent against a basket of major currencies and was up 0.2 percent versus the yen . * A measure of U.S. manufacturing activity surged to a near 13-1/2-year high in September as disruptions to the supply chains caused by Hurricanes Harvey and Irma resulted in factories taking longer to deliver goods and boosted raw material prices. * The White House on Monday ruled out talks with North Korea except to discuss the fate of Americans held there, again appearing to rebuke Secretary of State Rex Tillerson who said Washington was directly communicating with Pyongyang on its nuclear and missile programmes. * The Federal Reserve will need to “look hard” at whether it should raise rates in December, but there is no need to wait for inflation to actually get to, or even begin to rise back to, the Fed’s 2-percent target before doing so, Dallas Fed President Robert Kaplan said Monday. * The Fed’s own actions, not transitory factors, are responsible for weak inflation, a Fed policymaker argued on Monday, and the U.S. central bank should wait to raise rates again until inflation hits its 2-percent goal. * Relatively calm market conditions could encourage the European Central Bank to extend its asset purchase scheme for a longer period but with reduced monthly spending, ECB chief economist Peter Praet said on Monday. * Factories across the euro zone enjoyed their most productive month since early 2011 in September, and the momentum looks set to continue into October as new order growth accelerated, a survey showed on Monday. * British manufacturing growth cooled last month as cost pressures lurched higher, according to a survey that could put the Bank of England a step closer to raising interest rates, despite a murky outlook ahead of Brexit. * China’s proven gold reserves reached 12,100 tonnes at the end of 2016, the state news agency Xinhua reported on Monday. * Gold miner Avocet Mining Plc reported a 49 percent drop in first-half revenue as the West Africa-focused company’s gold production declined. DATA/EVENT AHEAD (GMT) 0900 Euro zone Producer prices Aug 1345 U.S. ISM-New York index Sep (Reporting by Apeksha Nair in Bengaluru; Editing by Joseph Radford)

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