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PRECIOUS-Gold steadies on mixed Chinese data, higher equities curb gains
Published at 15/07/2019 at 12:33

* China GDP in line with consensus, activity data strong

* Platinum hits more than one-week high

* Spot gold looks neutral in $1,404-$1,421 range - technicals

* GRAPHIC-2019 asset returns:

(Updates prices)

By Karthika Suresh Namboothiri

July 15 (Reuters) - Gold steadied on Monday after data showed Chinese economic growth slowed to its weakest in about 27 years, while gains in equities curbed demand for bullion as investors latched onto some positive readings from the world's second-biggest economy.

China's second-quarter annual GDP growth fell to a 27-year low of 6.2%, as expected, but its quarterly growth reading of 1.6% beat forecasts. June reports on industrial production, retail sales and urban investment were above expectations.

Spot gold was little changed at $1,415.51 per ounce as of 1123 GMT, reversing some losses ahead of the data. U.S. gold futures rose 0.4% to $1,417.50.

"Markets expected gold prices to push higher given that Chinese growth was the slowest in almost 30 years. However, if you look at the bigger picture, it is still above the 6% level ... Hence we're seeing this mixed reaction with gold," said Lukman Otunuga, research analyst at FXTM.

China's trading partners and financial markets are closely watching as the Sino-U.S. trade war gets longer and costlier, fuelling worries of a global recession.

World shares rose towards an 18-month high following the data.

"Gold is waiting for a fresh directional catalyst. Today is a slow start for gold, but that doesn't mean it's going to be a slow week," Otunuga added.

Investors await other data this week, such as U.S. retail sales and industrial production, for clues about the health of the world's largest economy. The U.S. Federal Reserve releases its "Beige Book" on Wednesday, which markets will watch for comments on how trade tensions have affected the business outlook.

Gold gained 1.1% last week on the back of expectations of an interest rate cut by the U.S. central bank, which also weighed on the dollar .

The outlook for gold remains positive, analysts said, with the metal likely to stay supported on expectations of a Fed rate cut and concerns of a global growth slowdown.

"The overall growth picture still looks weak. With further tensions around (U.S.-China) trade talks and geopolitical concerns in the Middle East, the need for gold as a hedge still remains strong," said Howie Lee, economist at OCBC Bank.

Spot gold looks neutral in a narrow range of $1,404-$1,421 per ounce, and an escape could suggest a direction, Reuters technical analyst Wang Tao said.

Palladium rose about 1% to $1,558.64 an ounce, while silver added 0.7% to $15.32. Platinum gained 1.5% to $839.51, marking a one-week high.

(Reporting by Karthika Suresh Namboothiri in Bengaluru; Editing by Dale Hudson and Mark Potter)

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