PRECIOUS-Gold rises 1% after Fed stands pat on rates, curbs hike hopes

(Adds comments, details, updates prices)
* Palladium hits peak of $1,917.30; set for 14th straight
gain
* Dollar drops to four-month low
* Traders await ECB meetings, trade deadline
* GRAPHIC-2019 asset returns: http://tmsnrt.rs/2jvdmXl

By Karthika Suresh Namboothiri and Brijesh Patel
Dec 11 (Reuters) - Gold extended gains on Wednesday, rising
nearly 1%, after the U.S. Federal Reserve held interest rates
steady and signaled borrowing costs are likely to remain
unchanged indefinitely, sending the dollar and Treasury yields
lower.
After cutting rates three times earlier this year, the Fed
left its benchmark rate at the target range of between 1.50% and
1.75%, in a widely expected move. Spot gold XAU= was up 0.7% at $1,474.62 per ounce as of
04:00 p.m. ET (2100 GMT). U.S. gold futures GCv1 settled 0.5%
higher at $1,475.
"Gold is pushing to fresh highs above $1,475 per ounce as
Jerome Powell sets a high hurdle to rate increases," said Tai
Wong, head of base and precious metals derivatives trading at
BMO.
"Gold approaches $1,480 pivot which had been a durable
bottom of the $1,480-$1,520 range from Aug to Oct; a move back
higher combined with a bond rally could renew bullish interest
which has dissipated somewhat over the past month."
Fed Chair Powell said in order for the U.S. central bank to
move rates up, it would have to see a significant, persistent
rise in inflation. In the wake of Powell's comments, the dollar index .DXY
slipped to a four-month low, while U.S. Treasury yields crept
lower. USD/ US/
"If we continue to see dollar weakness for the rest of the
year, we could see gold make a run back toward the $1,500 an
ounce level," said Edward Moya, a senior market analyst at
OANDA, in a note.
The European Central Bank is also expected to keep rates
steady at a meeting on Thursday. ECBWATCH
Also on investors' radar is the next round of U.S. tariffs
on Chinese imports, scheduled to take effect on Dec. 15.
Top economic and trade advisers from the White House are
expected to meet in coming days with Trump, a source told
Reuters, though a final decision has not been made. MKTS/GLOB
Palladium XPD= rose 0.9% to $1,913.26 an ounce, having
scaled a fresh peak of $1,917.30, on concerns that stagnating
supply of the autocatalyst metal may fail to meet demand.
Adding fuel to supply concerns, prices zoomed past the key
$1,900 level on Tuesday after mines across South Africa began
shutting down due to power blackouts. Platinum XPT= jumped 2% to $940.41 to a more than
one-month high.
South Africa is a major producer of palladium and also has
the biggest and most lucrative platinum reserves.
Meanwhile, spot silver XAG= rose 1.2% to $16.86 an ounce.