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Gold inches up as dollar slides, even as risk premium fades

Reuters  |  NEW YORK/LONDON 

By and Jan Harvey

NEW YORK/LONDON (Reuters) - Gold prices rose on Monday as losses in the U.S. dollar bolstered, though gains were muted as financial markets bet that air strikes on would not escalate into a wider conflict.

Prices have trended sideways since January, buoyed by geopolitical worries but capped by expectations for further U.S. interest rate hikes and strong technical resistance at $1,360-$1,365 an ounce - their January, February and April highs.

Spot gold was up 0.10 percent at $1,346.31 per ounce by 2:49 p.m. EST, up 0.1 percent, as U.S. gold futures for June delivery settled up 0.21 percent at $1,350.70 per ounce.

Forces from the United States, Britain and targeted with air strikes on Saturday, hitting what they said were three of its

Gold prices reached a high of $1,350.52 on the back of the news, but struggled to maintain those gains amid expectations the attacks would not mark the start of greater Western involvement in the conflict.

"Some of the risk (premium) has come down following the air strikes," analyst said. "Some market participants were thinking that maybe there could be an escalation of the tensions, but that has not happened and therefore prices have come down a bit."

Bullion found support as the dollar sank against the euro.

"Syria, trade tensions, and the dollar index falling off are all good reasons for gold prices to continue to rise," said at in "It's disappointing there wasn't more of a rally, but traders are turning to equities at these levels."

Speculators raised their net long positions in COMEX gold contracts by 363 contracts to 138,212 contracts in the week to April 10, (CFTC) data showed on Friday. [CFTC/]

Silver was up 0.39 percent at $16.683 per ounce.

Palladium rose 1.54 percent at $1,002.22 an ounce, off highs of $1,012.10, the strongest since March 1. Platinum was 0.15 percent higher at $928.90.

"Palladium is shooting up because of Russian sanctions," said George Gero, of

Prices rose 9.6 percent last week, their biggest weekly gain in more than a year, as concerns that supply from number one could be disrupted by U.S. sanctions into a strong technical rebound following the metal's 20 percent fall from its January record high.

The gyrations shot palladium's premium above platinum above $76 an ounce, the strongest since January.

Platinum has historically been the higher-priced metal, but supply concerns have driven palladium to a rare premium in recent months.

(Reporting by Jan Harvey; Additional reporting by in Bengaluru; editing by and Chizu Nomiyama)

(This story has not been edited by Business Standard staff and is auto-generated from a syndicated feed.)

First Published: Tue, April 17 2018. 01:06 IST
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