PRECIOUS-Gold prices slip as dollar gains, stocks rebound
* Spot gold on track for biggest weekly gain in seven
* Palladium off eight-month highs hit on Thursday
* Platinum hovers near Thursday’s more than 2-month highs (Updates prices; adds comments, details)
BENGALURU, Oct 12 (Reuters) – Gold prices eased on Friday, a day after they registered their biggest daily gain in more than two years, as the U.S. dollar climbed and global stocks rebounded following a six-day rout.
Spot gold was down 0.3 percent at $1,219.78 an ounce by 12:43 p.m. EDT (1643 GMT), having jumped about 2.5 percent in the previous session as an equities selloff steered investors towards the safe-haven asset.
Thursday’s peak of $1,226.27 was the highest since July 31. Spot gold has risen about 1.4 percent this week, on track for its biggest weekly gain in seven weeks.
U.S. gold futures were down 0.4 percent at $1,223.30 an ounce.
“A rally in the U.S. dollar is putting downward pressure on gold today,” said Alex Turro, market strategist at RJO Futures.
The dollar index rose as global equities rebounded and on strong Chinese export data.
“Event-driven rallies usually don’t last long,” said George Gero, managing director at RBC Wealth Management, adding that a rebound in equities was one of the main factors weighing on gold.
“We need more (ammunition) for gold to move further as it has been very well abandoned with only a few central banks buying besides some retail buyers.”
Despite gold’s sharpest one-day percentage gain since June 2016 on Thursday, the precious metal is still down about more than 10 percent from its April peak, with investors buying dollars as the U.S.-China trade war unfolds against a backdrop of rising U.S. interest rates.
The Fed increased rates last month for the third time this year and is widely expected to raise them again in December.
“Gold is going to be dictated by the U.S. Federal Reserve. As long as interest rates continue to move higher, it’s going to continue to apply a lot of downward pressure on the precious complex,” RJO Futures’ Turro said.
Thursday’s surge helped bullion break above the narrow trading range it has been stuck in for the past 1-1/2 months.
“Gold is trading fairly close to the 100-day moving average at $1,228. There should be plenty of resistance, but a close above that level could signal a move higher,” MKS PAMP Group traders said in a note.
In other precious metals, palladium fell 1 percent to $1,066.80. The metal rose to its highest since Jan. 26. at $1,096.80 in the previous session.
Silver was up 0.1 percent to $14.58 and platinum was down 0.3 percent at $836.80, hovering below the previous session’s more than two-month high of $843.90. (Reporting by Swati Verma and Nallur Sethuraman in Bengaluru Editing by Bernadette Baum)
0 Comments