Gold prices slip on rising dollar - GulfToday

Gold prices slip on rising dollar


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Gold prices fell in muted trade on Monday as the dollar strengthened and share markets rose, though lingering tensions between the United States and China limited losses.

Spot gold was down 0.4% at $1,726.80 an ounce at 1233 GMT.

US gold futures fell 0.5% to $1,727.60. Most markets were closed in the United States, Britain and some Asian countries for public holidays.

“The main driver probably is the dollar is slightly stronger and also risk sentiment, in spite of renewed tensions between the US and China, that still seems to be on the positive side,” said UBS analyst Giovanni Staunovo.

The dollar rose against its key rivals, making gold more expensive for holders of other currencies. European shares gained as optimism over easing lockdowns and signs of further stimulus for the battered eurozone economy bolstered sentiment.

On the geopolitical front, China’s proposed national security legislation for Hong Kong could lead to US sanctions, White House National Security Adviser Robert O’Brien said on Sunday. US-China tensions have also become increasingly strained over the source of the coronavirus pandemic, which has infected more than 5.4 million people globally.

“Trade war tensions are on the rise, which should continue to hold a bid under gold prices over the short term supported by the bullish cocktail of economic, trade and geopolitical factors,” Stephen Innes, chief market strategist at financial services firm AxiCorp, said in a note.

Indicative of sentiment, SPDR Gold Trust holdings rose 0.4% to 1,116.71 tonnes on Friday, while speculators increased their bullish positions in COMEX gold and silver contracts in the week to May 19.

Elsewhere, palladium gained 1.3% to $1,970.23 an ounce, while platinum dropped 1.4% to $828.35 and silver slipped 0.7% to $17.05.



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