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Gold climbs for fourth day as dollar slips and euro rallies

Reuters  |  LONDON 

By Eric Onstad

(Reuters) - Gold prices extended gains for a fourth day on Tuesday as political troubles in the United States dented the dollar while a more upbeat scenario in lifted the euro.

"The dollar is weak today, which has helped metals across the board," said Carsten Menke, analyst at Julius Baer in Zurich, saying the move in the greenback was a combination of events in the United States and

Spot gold was up 0.3 percent at $1,234.21 per ounce at 1410 GMT. On Monday, it hit $1,237.26, its highest since May 4.

U.S. gold futures rose 0.3 percent to $1,234 an ounce.

The dollar index slipped to the weakest in more than six months after two U.S. officials said President Donald Trump disclosed highly classified information to Russia's foreign minister about a planned Islamic State operation.

Investors regarded Trump's difficulties as another obstacle to planned U.S. tax cuts and infrastructure spending which had boosted the dollar in the months following the November election.

At the same time, markets were cheered about the outlook for after German Chancellor Angela Merkel and new French President Emmanuel Macron agreed to draw up a roadmap to deepen European Union integration, while economic growth data and German investor morale were strong.

"The weekend German state elections were favourable for Merkel and after the French elections, the risk backdrop in is diminishing," Menke said.

Gold is used as an alternative investment during times of political and financial uncertainty.

Investors may become more cautious, however, due to recent developments including a North Korean missile test and the "ransomware" cyber attack, which could lift gold prices over the next two weeks, said Mark To, head of research at Hong Kong's Wing Fung Financial Group.

Spot gold may rise more to $1,245 per ounce, as it has cleared a resistance at $1,233, according to technical analyst Wang Tao.

Among other metals, silver rose 0.5 percent to $16.67 an ounce.

Platinum held near a two-week high hit on Monday, adding 0.5 percent to reach $932.

A bullish signal for platinum has appeared in charts, said Stephanie Aymes, head of technical analysis at Societe Generale.

"Short term, platinum looks headed for $953, the trend line resistance and the 61.8 percent retracement of the last bout of down move, and $991," she said in a note, adding that further targets would be $1,046 and $1,080.

Producers, fabricators and traders have gathered for Platinum Week in

Palladium edged up 0.1 percent to $797.60 an ounce.

(Additional reporting by Vijaykumar Vedala in Bengaluru; editing by Louise Heavens and David Clarke)

(Only the headline and picture of this report may have been reworked by the Business Standard staff; the rest of the content is auto-generated from a syndicated feed.)