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Gold prices slip as dollar gains after US Senate clears tax bill

The dollar rebounded to a two-week high after taking a brief hit on on news that Michael Flynn pleaded guilty to lying to the FBI about his contacts with Russia.

Reuters 

Gold prices slip as dollar gains after US Senate clears tax bill

fell in Asian trade on Monday, as the dollar gained on expectations that the United States' will expand further after the Senate passed a bill to overhaul the country's tax system.

The Senate narrowly approved the overhaul on Saturday, moving the and US President a big step closer to their goal of slashing taxes for businesses and the rich while offering everyday Americans a mixed bag of changes.

The dollar rebounded to a two-week high on Monday after taking a brief hit on Friday on news that Michael Flynn, former national security adviser to Trump, pleaded guilty to lying to the US of Investigation about his contacts with Russia.

"Bullion is likely to be sensitive to dollar flows, tracking headlines generated by the probe and any further tax reform related news as we head toward US Nonfarm Payrolls at the end of the week," MKS PAMP trader Sam Laughlin said in a note.

was down 0.6 per cent at $1,272.91 an ounce, as of 0735 GMT, after touching a high of $1289.50 on Friday.

US were down 0.5 per cent at $1,275.80 an ounce.

"I think people will be disappointed that gold had that race up to $1290 area on Friday and we're sitting at $1275...any kind of rally gold has just seems to be unsustainable for the short-term" said a Hong Kong-based gold trader.

"Whatever is happening to the dollar and the yield curve, you've got to be watching that," the trader said.

Two Federal Reserve policymakers urged caution in raising interest rates on Friday, saying that the flattening of the yield curve was a signal that the central bank should proceed slowly.

The is widely expected to raise benchmark interest rates for the third time this year at its meeting next week. Higher rates tend to boost the dollar, making the greenback-denominated gold more expensive for buyers using other currencies.

Meanwhile, investors also kept a keen eye on developments surrounding North Korea, with and the US launching their largest-ever joint aerial drills on Monday, days after the North tested its most advanced

Reuters technicals analyst Wang Tao said may break a support at $1,272 per ounce and fall more towards the next support at $1,263.35.

Speculators raised their net-long positions in in the week to November 28, US data showed on Friday.

In other precious metals, silver slipped 0.7 per cent to $16.32 an ounce.

was 0.4 per cent lower at $933.50 an ounce, while was little changed at $1,019.40.

 

 

First Published: Mon, December 04 2017. 13:36 IST
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