(Updates prices)
* Silver hits highest level since April 2017
* Platinum scales near one-month high
* GRAPHIC-Gold in various currencies: http://tmsnrt.rs/1JxbO6Y
By K. Sathya Narayanan
Aug 28 (Reuters) - Gold held close to a more than six-year
high on Wednesday, after rising more than 1% in the previous
session, as fears of a possible recession and the trade conflict
between China and the United States drove investors to safe
haven assets.
Spot gold XAU= was flat at $1,542.33 per ounce as of 1222
GMT. On Monday it touched $1,554.56, its highest since April
2013.
U.S. gold futures GCcv1 were up 0.2% at $1,555.
"There is some kind of consolidation at these price levels
(around $1,550) and the market is assessing the next development
in the U.S.-China trade saga," said SP Angel analyst Sergey
Raevskiy.
While there are expectations for monetary policy easing in
the euro zone, inversion in U.S. Treasury yield curve increased
hopes for further rates cuts by the U.S. central bank, he added.
Gold rose more than 1% on Tuesday as an inversion in the
U.S. yield curve and disappointing U.S. economic data rekindled
fears of a recession amid uncertainties around the trade
dispute. US/ "People are beginning to think that the economy is not doing
that well, there could be a possible recession, or more likely,
a slowing economy, which means the Federal Reserve will have to
cut rates and that supports gold," said John Sharma, an
economist with National Australia Bank.
Federal funds futures FEDWATCH implied traders saw a 91%
chance of a 25 basis-point rate cut by the U.S. central bank
next month.
Meanwhile, U.S. President Donald Trump on Monday predicted a
trade deal with China but optimism wilted after China's foreign
ministry spokesperson dismissed claims of phone calls between
the two sides. However, "if there are some sort of tangible signs that the
(trade) talks are going to restart, or at least that they are
getting there, it would be a risk-on outcome and we can see
yields go higher and push gold a bit lower," said Ilya Spivak,
senior currency strategist with DailyFx.
On the technical front, bullion's 14-day relative strength
index (RSI) was around 70, indicating that the commodity was
approaching overbought territory.
"Gold has become a crowded trade, raising the possibility of
a short-term correction," ANZ analysts said in a note.
Elsewhere, spot silver XAG= jumped 1.5% to $18.44 an
ounce, having touched $18.50, its highest level since April
2017.
"There is not much at present to suggest that the demand for
gold and silver might abate," Commerzbank analysts wrote in a
note.
Spot platinum XPT= climbed 0.7% to $871.60 an ounce, after
touching its highest in nearly a month, while palladium XPD=
slipped 0.8% to $1,469.51.
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Gold and silver spot price performance in 2019 png https://tmsnrt.rs/2NAIwe3
Gold and silver spot price performance in 2019 interactive https://tmsnrt.rs/2NAUc0d
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