Business Standard

Gold hits six-month peak but heads for first annual decline since 2015


By Karthika Suresh Namboothiri
BENGALURU (Reuters) - Gold prices scaled a six-month high on Monday but was poised for its first annual decline since 2015 after previous declines on higher interest rates and dollar strength from the Sino-U.S. trade conflict.
Spot gold rose 0.1 percent to $1,282.62 an ounce at 0920 GMT, with a diup in the dollar helping to lift the metal to its highest since June 19. U.S. gold futures were also up 0.1 percent at $1,284.
U.S. President Donald Trump said on Sunday that a possible trade deal between the United States and China was progressing well.
"Looking at the equity markets, one can clearly see that there is positive optimism around this subject. However, gold traders aren't willing to pay too much attention to this," said Naeem Aslam, chief market analyst at Think Markets UK.
Gold prices jumped about 5 percent in December, mostly because of wild swings in equities, but it has declined nearly 1.6 percent for the year.
The dollar index was down 0.1 percent on Monday, having gained 4.6 percent this year as the U.S.-China trade conflict unfolded against a backdrop of higher U.S. interest rates, denting gold demand.
Gold has regained its safe-haven appeal because of turmoil in financial markets, said Benjamin Lu Jiaxuan, commodities analyst at Singapore-based brokerage firm Phillip Futures, adding that political and economic considerations will support prices into the first quarter of 2019.
Palladium gained 0.3 percent to $1257.35 an ounce and has been the best-performing precious metal this year.
It also surpassed gold for the first time since 2002 on strong demand from autocatalyst makers. The metal has climbed by about 18 percent over the year and was set for a fifth consecutive monthly gain.
Silver rose 0.3 percent to $15.40 an ounce in the session but was down 9 percent for 2018.
Platinum edged up by 0.4 percent to $792.74, making little impact on a decline of about 14 percent for the year.
(Reporting by Nallur Sethuraman in Bengaluru; Editing by David Goodman)

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First Published: Dec 31 2018 | 3:41 PM IST

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