May 22, 2018 / 10:46 AM / 7 months ago

PRECIOUS-Gold steadies as dollar rally comes off the boil

    * Easing of geopolitical risk negative for gold -analyst
    * Platinum edges up from five-month low hit a day earlier

 (Recasts; updates prices; adds comment, adds byline, NEW YORK
to dateline)
    By Renita D. Young and Maytaal Angel
    NEW YORK/LONDON, May 22 (Reuters) - Gold steadied just above
a 2018 low on Tuesday as the U.S. dollar fell from a five-month
high, although risk appetite in the broader financial markets
kept the metal's gains in check.
    The dollar lost momentum after a rally sparked by rising
U.S. bond yields and the prospect of a resolution to U.S.-China
trade tensions.                            
    "Gold is tracking the dollar and the dollar is a little
weaker today," said Rob Haworth, senior investment strategist
for U.S. Bank Wealth Management.
    A weaker dollar makes dollar-priced gold cheaper for
non-U.S. investors. 
    Spot gold        was flat at $1,292.51 at 1:34 p.m. EDT
(1734 GMT). U.S. gold futures         for June delivery settled
up $1.10, or 0.1 percent, at $1,292 per ounce. 
    "This quarter and maybe going into next, gold will continue
to struggle but the (positive) views on the U.S. economy are
overdone," said Philip Newman, director at Metals Focus. 
    "There are concerns over sizeable U.S. debt, there's the
mid-term elections in November, there's enough out there that
could see the dollar eventually weaken and gold prices start to
improve through the back end of this year."
    Capping gains in gold, European shares inched to a near
four-month high as an easing of pressure on Italian markets
coincided with China's latest move to open its economy to the
rest of the world.            
    Gold, regarded as a safe haven, tends to weaken when there
is strong investor appetite for equities, which are seen as
higher-risk assets.
    Easing geopolitical tensions also weighed on gold prices,
said Stephen Innes, APAC trading head at OANDA. 
    Gold investors are awaiting the release on Wednesday of the
minutes of the U.S. Federal Reserve's latest policy meeting.
    Expectations that the Fed will raise U.S. interest rates
again next month pressured gold. Higher rates tend to boost the
dollar and bond yields, making non-yielding assets such as
bullion less attractive.                        
    Innes said any drop to somewhere around the $1,275 level
would start to stir more bullish sentiment. 
    Demand for industrial metals platinum, palladium and silver
rose after China said it would cut import duties on passenger
cars and parts from July 1, U.S. Bank Wealth Management's
Haworth added.             
    Silver        was up 0.5 percent at $16.57 an ounce, after
touching an eight-day high of $16.67. Palladium        gained
0.4 percent at $993.80 an ounce, earlier hitting an 11-day high,
$1,006.00.
    Platinum        climbed 1.3 percent to $908 an ounce, after
hitting a one-week high of $910.90.

 (Additional reporting by Karen Rodrigues and Apeksha Nair in
Bengaluru; editing by David Stamp, Alexandra Hudson and Richard
Chang)
  
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