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1st LD Writethru: Gold up on weaker U.S. Dollar

Xinhua, February 18, 2016 Adjust font size:

Gold futures on the COMEX division of the New York Mercantile Exchange rose on Wednesday on a weaker U.S. dollar.

The most active gold contract for April delivery rose 3.2 U.S. dollars, or 0.26 percent, to settle at 1,211.40 dollars per ounce.

Gold was given support as the U.S. dollar index, a measure of the greenback against a basket of major currencies, fell by 0.09 percent to 96.81 as of 1745 GMT. Gold and the dollar typically move in opposite directions.

U.S. equities continued to rebound, weighing on the precious metal. The U.S. Dow Jones Industrial Average rose by 225 points, or 1.39 percent, as of 1745 GMT. Analysts note that when equities post losses, the precious metal usually goes up, as investors are looking for a safe haven, while the opposite is true when U.S. equities post gains.

Gold was prevented from rising higher as a report released by the U.S. Department of Labor on Wednesday showed the producer price index rose by 0.1 percent, and that a separate measure that excludes food and gas edged up 0.4 percent. Both figures were better than expected.

A report released by the U.S. Department of Commerce on Wednesday showed industrial production increasing by 0.9 percent during the month of January, a figure which was better than expected. Analysts also noted extensive strength in the auto manufacturing sector which also posted better than expected gains.

Traders are also eagerly waiting for the release of the Fed meeting minutes due out after the market's close on Wednesday.

Silver for March delivery added 4.3 cents, or 0.28 percent, to close at 15.377 dollars per ounce. Platinum for April delivery rose 12.4 dollars, or 1.32 percent, to close at 949.70 dollars per ounce. Endit