Gold traded flat in early Asian trade on Tuesday as the dollar held firm on expectations that the Federal Reserve will announce a tapering of its bond purchases next month.

 

FUNDAMENTALS

* Spot gold was unchanged at $1,753.77 per ounce by 0123 GMT, while U.S. gold futures were little changed at $1,754.90.

* The dollar hovered close to a one-year high touched last month amid surging energy prices and expectations the U.S. central bank would soon start normalising policy. 

* Gold is seen as a hedge against inflation and currency debasement likely from the widespread stimulus. The Fed's tapering could tackle both those conditions, diminishing bullion's appeal.

* The current bout of inflation in the euro zone is not a trigger for monetary policy action as growth in services prices and wages remains weak, European Central Bank chief economist Philip Lane said on Monday.

* Russia's Nornickel, the world's largest producer of palladium, has cut its deficit estimate for the global palladium market this year and next year due to the flagging recovery of the auto sector, a senior executive told Reuters. 

* Spot silver fell 0.2% to $22.52 per ounce, while platinum dropped 0.5% to $1,003.87.

* Palladium was down 0.4% to $2,103.16, having hit its highest since Sept. 10 at $2,182.67 on Monday.

 

(Reporting by Eileen Soreng in Bengaluru; Editing by Subhranshu Sahu) ((eileen.soreng@thomsonreuters.com; Within U.S. +1 646 223 8780, Outside U.S. +91 80 6749 6131; Reuters Messaging: eileen.soreng.thomsonreuters.com@reuters.net))