* Expectations on bond buying by ECB rise
* Spot gold may fall to $1,582.58/oz -technicals
* Coming Up: Italy, Q2 preliminary GDP; 0900 GMT
(Updates prices; changes bullet point)
By Rujun Shen
SINGAPORE, Aug 7 (Reuters) - Gold traded nearly flat on
Tuesday, retaining gains from the past two sessions as investors
waited for action from the European Central Bank in hopes that
it would do more to tackle the region's debt crisis.
Investors are on watch for details of the ECB's bond
purchasing plans, after bank chief Mario Draghi said last week
that it would target shorter-dated debt, warming up sentiment on
the European government debt market.
That, together with the uncertainty around the U.S. Federal
Reserve's future policy moves, would extend the wait-and-see
game in gold for a little longer, traders said.
"On the macroeconomic front, things haven't changed
dramatically -- the U.S. economy is not doing too bad, and the
European economy is a mess. The Fed is waiting for a perfect
time to make a final strike with a third round of quantitative
easing," said a Shanghai-based trader.
A majority of Wall Street economists polled by Reuters
expect the Fed to launch QE3 as soon as September, but a top Fed
official said new stimulus measures so close to a presidential
election would be a mistake.
Spot gold had barely moved at $1,610.90 per ounce by
0630 GMT, after rising more than 1 percent over the past two
sessions.
The U.S. gold futures contract for December delivery
inched down 0.2 percent to $1,613.80.
Technical analysis suggested gold could slide to $1,582.58
per ounce during the day, said Reuters market analyst Wang Tao.
CHINA SEEN STABILISING; GOLD DEMAND STRONG
Later in the week, China is expected to release its
inflation, industrial output and trade data for July, which is
expected to show that the world's No.2 economy was, at best,
stabilising in the beginning of the second half of the year
rather than recovering briskly.
"We continue to like precious metals, even as central bank
event risks have been largely removed until September, as
further disappointment with politically driven 'growth agendas'
should confirm the need for even stronger monetary solutions to
reignite nominal growth, a necessary condition in deleveraging
global economies," Societe Generale said in a research note.
The world's top gold producer, China, which has overtaken
India as the world's top gold consumer, continued to show strong
appetite for bullion.
In the first half of 2012, the gold flow from Hong Kong, a
main conduit of bullion into China, grew sixfold on the year,
although the flow in the opposite direction remained unusually
high for a fourth month in June.
China churned out 36.3 tonnes of gold in June, sending total
output in the first half of the year to 177 tonnes, up 7.7
percent on the year.
Precious metals prices 0630 GMT
Metal Last Change Pct chg YTD pct chg Volume
Spot Gold 1610.90 0.51 +0.03 3.01
Spot Silver 27.82 -0.04 -0.14 0.47
Spot Platinum 1401.74 6.34 +0.45 0.63
Spot Palladium 579.25 4.45 +0.77 -11.23
COMEX GOLD DEC2 1613.80 -2.40 -0.15 3.00 5784
COMEX SILVER SEP2 27.78 -0.09 -0.32 -0.50 1259
Euro/Dollar 1.2384
Dollar/Yen 78.24
COMEX gold and silver contracts show the most active months
(Editing by Chris Lewis)