* Bullion prices steady after three days of record peaks
* SPDR gold ETF holdings rise another 3.65 T
* Coming up: U.S. Federal Reserve policy statement, 1815 GMT
(Updates prices)
By Jan Harvey
LONDON, Sept 21 (Reuters) - Gold eased in Europe on Tuesday
as the market consolidated after three days of record highs, but
remained supported by speculation the Federal Reserve may signal
a move towards further stimulus measures after a policy meeting
later in the day.
Prices came under a little pressure in early afternoon trade
as the dollar pared losses against a basket of currencies,
helped by data showing U.S. housing starts rose more than
expected in August, but remained firmly underpinned.
Spot gold <XAU=> was bid at $1,276.25 an ounce at 1524 GMT,
against $1,279.25 late in New York on Monday. U.S. gold futures
for December delivery <GCZ0> fell $3.30 to $1,277.50.
"Today we are just waiting for the Fed," said Deutsche Bank
trader Michael Blumenroth. "After that, other markets will move,
currency markets especially, and then we will see."
"Everyone is thinking you should not be short at this time
of year for seasonal reasons," he added. "And there is some
money flowing into the gold market due to safe-haven buying."
While few traders expect the Fed to unveil further
quantitative easing measures just yet, the bank may signal its
readiness to take such steps if needed.
Any further round of quantitative easing would reflect
concern over the outlook for U.S. growth, meaning interest rates
are likely to remain lower for longer, and could undermine the
U.S. dollar, and ultimately prove inflationary.
The dollar earlier fell towards a six-week low against a
basket of six major currencies <.DXY> ahead of the meeting,
which will take place in Washington and is due to conclude with
an announcement at 1815 GMT. []
"Market speculation over QE-2 has played its part in
boosting gold prices and continues to add to the positive
sentiment combined with central bank buying and producer hedge
book buybacks," said Barclays Capital in a note.
"Our economists believe the incoming data since the August
meeting will keep the Fed on the sidelines in September," it
added. "They expect the FOMC to maintain the "extended period"
language and abstain from initiating further asset purchases."
MAJOR GOLD ETF HOLDINGS RISE
Investment demand for gold remained healthy, with holdings
of the world's largest gold-backed exchange-traded fund, New
York's SPDR Gold Trust <GLD>, rising another 3.65 tonnes on
Monday to 1,304.472 tonnes. []
Investment in the precious metal has been firm this year as
concerns over the global economy, the stability of the financial
markets and the outlook for paper currencies boost buying of the
metal as a safe store of value.
World Gold Council country manager Cihan Goksel told a WGC
meeting in Istanbul on Tuesday that global gold demand rose 36
percent in the second quarter to 1,050 tonnes. []
This has lent considerable support to gold. A debate at the
Denver Gold Forum on Monday found few delegates at the
conference expect prices to fall imminently. []
DundeeWealth Economics economist Martin Murenbeeld forecast
the precious metal will keep rising because of heavy demand from
central banks, the jewellery industry and private investors at a
time when supplies have dwindled.
Among other precious metals, silver <XAG=> eased to $20.59
from $20.73 an ounce, after hitting a 2-1/2 year high of $20.99
on Friday. Platinum <XPT=> was at $1,618.50 an ounce against
$1,625.75, and palladium <XPD=> at $530.50 versus $535.40.
The U.S.-based palladium exchange-traded product operated by
a unit of London's ETF Securities saw an outflow of nearly
20,000 ounces on Monday, the largest dip in its holdings since a
near-30K oz decline in late July, data on its website showed.
(Editing by Alison Birrane)
