* Fed due to release its latest statement on Wednesday
* Gold priced in euros jumps to its highest since April 2017
* Palladium hits 12-week high
(Adds comments, details, updates prices)
By Eileen Soreng
June 18 (Reuters) - Gold on Tuesday climbed more than 1% to
a near 14-month high, supported by expectations of dovish
statements from the U.S. Federal Reserve and as European Central
Bank President Mario Draghi's comments indicated the possibility
of rate cuts.
Lower interest rates decrease the opportunity cost of
holding non-yielding bullion.
Spot gold XAU= was up about 1% at $1,352.23 per ounce at
1257 GMT. Last week, prices had hit a high of $1,358.34, a peak
since April 11.
U.S. gold futures GCcv1 were up 0.8% at $1,353.7 an ounce.
"There is some positioning ahead of the FOMC (Federal Open
Market Committee) meeting ... Everyone is waiting to see how
dovish Fed's going to be and if there is any sort of signalling
of cuts on the way to the interest rates," ING analyst Warren
Patterson said.
The Fed's policy-setting committee is due to release its
latest statement and economic projections at on Wednesday after
the end of a two-day meeting.
The U.S. central bank is expected to leave borrowing costs
unchanged this time but possibly lay the groundwork for a rate
cut later this year. Markets are almost fully pricing in a
25-basis-point rate cut for July. Meanwhile, Draghi on Tuesday said the ECB will ease policy
again if inflation fails to accelerate, signalling one of the
biggest policy reversals of his eight-year tenure. Gold priced in euros XAUEUR=R also jumped to its highest
level since April 2017.
The fact that investors remain concerned over trade tensions
impacting global growth and that the major central banks across
the world are adopting a more dovish stance, the environment
looks good for gold to continue shining, said Lukman Otunuga,
research analyst at FXTM.
Gold has gained more than 6% since touching a 2019 low of
$1,265.85 in early May.
"The first key level of interest this week will be $1,350,
should we see a solid weekly close above this level gold has the
potential to actually attack at least $1,400 by the end of
2019," Otunuga added.
Elsewhere, silver XAG= was up 1% at $14.98 per ounce.
Palladium XPD= climbed 2.5% to $1,486.70 per ounce, having
hit a high since March 27 at $1,487.22 earlier in the session.
Platinum XPT= rose 1.2% to $801.11 an ounce after falling
to its lowest since May 31 at $786 earlier in the session.