PRECIOUS-Gold gains as risk appetite falters, trade optimism sours

(Updates prices)
* China's industrial production growth slows sharply in Oct
* Deterioration in Hong Kong supporting gold further -
analyst

By Eileen Soreng
Nov 14 (Reuters) - Gold rose on Thursday, extending gains to
a third session, as weak Chinese data and doubts about whether
Beijing and Washington will reach a trade deal anytime soon
dented demand for riskier assets.
Spot gold XAU= was up 0.4% at $1,468.23 per ounce, as of
1224 GMT, having climbed to a high of $1,470.33. U.S. gold
futures GCcv1 also rose 0.4% to $1,468.90 per ounce.
China and the United States are holding "in-depth"
discussions on a first-phase trade agreement, and cancelling
tariffs is an important condition to reaching a deal, the
Chinese commerce ministry said. "We are seeing some risk aversion in the markets," said
Craig Erlam, OANDA senior market analyst, adding: "The
commentary from both sides has kind of taken away some optimism
around this phase one deal."
On Tuesday, U.S. President Donald Trump said a trade deal
with China was "close" but offered no details and warned that he
would raise tariffs "substantially" on Chinese goods without
such an accord.
"Gold should be in greater demand at least in the short term
because the negotiations of a partial agreement in the trade
dispute between the U.S and China appear to have stalled,"
Commerzbank analyst Daniel Briesemann said in a note.
"...Trump's threat of further punitive tariffs against China
also appears to be having after-effects."
A Reuters poll of economists showed the U.S.-China trade war
was unlikely to see a permanent truce over the coming year, and
while concerns have eased over a U.S. recession, an economic
rebound is also not expected any time soon. World stocks nudged down as data showed China's industrial
output grew significantly slower than expected in October, while
Germany only narrowly avoided a recession in the third quarter,
compounding worries about the global growth fallout from the
trade war. MKTS/GLOB
Also supporting safe-haven gold were worries about
spiralling violence in Hong Kong as anti-government protesters
paralysed parts of the city for a fourth day. "We may have found a base around $1,445-$1,450, however the
metal is likely to remain range-bound over the near-term unless
we see $1,475-$1,480 broken," MKS PAMP said in a note.
Meanwhile, holdings of the world's largest gold-backed
exchange-traded fund, SPDR Gold Trust GLD , eased slightly to
896.77 tonnes on Wednesday. Among other precious metals, palladium XPD= gained 0.9% to
$1,725.43 per ounce. Silver XAG= rose 0.5% to $17.04 per
ounce, while platinum XPT= was 0.3% higher at $876.52 per
ounce.