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Gold prices slips to its lowest as surging US Treasury yields lift dollar

The metal was heading for its biggest weekly decline since early-December

Apeksha Nair | Reuters  |  Bengaluru 


Gold prices edged down on Friday to near their lowest levels this year, pressured by a firm U.S. dollar amid surging yields.

Spot gold was down about 0.1 percent at $1,289.16 per ounce at 0253 GMT, after hitting its lowest since Dec. 27 in the previous session at $1,285.41.

The was heading for its biggest weekly decline since early-December.

U.S. gold futures for June delivery were 0.1-percent lower at $1,288.30 per ounce.

The dollar hovered near a five-month peak against a basket of currencies on Friday thanks to the benchmark yield topping a seven-year high.

"The 10-year U.S. yields put the dollar on a firm foot and put pressure on metals and gold," said a Hong Kong-based trader, adding that some "risk-on" sentiment in today was also adding pressure.

A stronger greenback makes dollar-denominated gold more expensive for users of other currencies, while higher U.S. yields dampen the appeal of non-yielding bullion.

"$1,285 has been good support for the past couple of days, so that's the first support we'll see if it (spot gold) can hold," the said. He declined to be identified as he was not authorised to speak with media.

Meanwhile, Asian stocks were treading water on Friday as investors kept a cautious watch on developments in U.S.-trade negotiations.

U.S. said on Thursday that had become "very spoiled" on trade with the and cast doubt on the success of his efforts to rebalance the relationship with as high-stakes U.S.-negotiations opened in

Trump sought on Thursday to placate North Korea's after threatened to scrap an unprecedented summit.

"Without some resolution on both as well as the ongoing trade talks with the Chinese, we suspect the overall drift in will likely continue, with the path of least resistance for gold against such a backdrop being lower," said in a note.

In other metals, silver was little changed at $16.41 an ounce.

Palladium rose 0.2 percent to $979.50, while platinum was 0.2-percent higher at $890.20 per ounce after hitting a five-month low at $879 on Thursday.

However, all three of those metals were heading for weekly losses.

First Published: Fri, May 18 2018. 15:48 IST