You are here: Home » Reuters » News
Business Standard

Gold slips as U.S.-China trade row supports dollar

Reuters 

By K. Narayanan

(Reuters) - Gold fell on Monday as investors looked to the safety of the dollar to stave off risks from the U.S.- trade spat, as concerns mounted over a slowdown in global growth.

Spot gold fell 0.6 percent to $1,306.51 per ounce by 1053 GMT, after having risen for the previous two sessions.

U.S. gold futures declined 0.6 percent to $1,310.60 per ounce.

"The dollar seems to be the main beneficiary of the fears of economic slowdown, pushing gold down," said

"But gold has managed to be above $1,300 level, which is a fairly solid and decent support level since there are some downward pressures right now."

The dollar index was at a near six-week high, making the greenback-denominated gold more expensive for holders of other currencies.

The dollar has risen despite the Federal Reserve pausing its multi-year rate hike cycle and dovish comments from several Fed officials, which pushed gold to a nine-month high at $1,326.30 in late January.

While gold is supported by the Fed's policy, prices will likely remain range-bound until there is clarity on the trade front and shutdown, said in a note.

Investors' focus will be back on the trade talks between and this week as a delegation of U.S. officials travels to for the next round of negotiations.

U.S. said last week that he had no plans to meet with Chinese before a March 1 deadline to achieve a trade deal.

Also, In the latest development surrounding political gridlock in Washington, talks on border security funding collapsed after Democratic and Republican lawmakers clashed over immigrant detention policy as they worked to avert another shutdown.

"Global growth worries, absence of positive signs in U.S-trade negotiations and reduction in the euro-zone growth forecasts have laid a strong foundation for gold," said Benjamin Lu, an with Singapore-based

Adding to a string of disappointing global economic data, especially the euro zone, official figures on Monday showed Britain's economy slowed as expected in the final three months of last year, pushing growth in 2018 to its weakest in six years, as Brexit worries hammered investment.

Meanwhile, holdings of the SPDR Gold Trust, the world's largest gold-backed exchange-traded fund, saw outflows for five straight sessions last week.

Among other precious metals, palladium fell 1.2 percent to $1,384.55 an ounce.

Spot silver dropped 0.8 percent to $15.69, while platinum was down 1.4 percent at $787.16 per ounce, after earlier touching its lowest in three weeks.

(Reporting by K. Narayanan in Bengaluru; editing by David Evans)

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

First Published: Mon, February 11 2019. 16:53 IST
RECOMMENDED FOR YOU