Gold prices hold steady as US dollar eases

Gold prices held steady on Thursday, after rising nearly 1 percent in the previous session, as the dollar slipped further from a 16-month peak hit earlier in the week.

Spot gold was little changed at $1,211.12 per ounce at 0453 GMT.

U.S. gold futures inched up 0.1 percent at $1,211.7 per ounce.

“There’s going to be a bid to gold provided the dollar continues to slide,” said Stephen Innes, APAC trading head at OANDA in Singapore.

The dollar index, which measures the greenback against a basket of six major currencies, traded at 96.84, off a 16-month high hit on Monday.

“We could see further slide in the dollar since we didn’t get any follow through on the bullish consumer price index effect,” Innes added.

U.S. consumer prices increased by the most in nine months in October amid gains in the cost of gasoline and rents, pointing to steadily rising inflation that likely will keep the Federal Reserve on track to raise interest rates again next month.

Gold has fallen more than 11 percent from a peak in April as investors flock to the dollar, with U.S.-China trade friction unfolding against a backdrop of higher U.S. interest rates.

Higher U.S. interest rates tend to boost the dollar and also push up bond yields, reducing the appeal of non-yielding bullion.

“For gold, 1,200 is providing a good support and the market could trade firmer from here,” said Peter Fung, head of dealing at Wing Fung Precious Metals in Hong Kong.

Meanwhile, Asian stocks rose on Thursday, supported by a bounce in Chinese shares on news that Beijing has delivered a written response to U.S. trade demands, raising hopes the two sides could resume negotiations to end their trade war.

Spot gold may extend its bounce to $1,223 per ounce, following its stabilization around a support at $1,195, said Reuters technical analyst Wang Tao.

Among other precious metals, silver was up 0.1 percent at $14.14 per ounce. The metal fell to its lowest level since January 21, 2016 at $13.85 in the previous session.

Platinum dipped 0.6 percent to $829.75 an ounce, while palladium fell 0.1 percent to $1,123.24 per ounce.

Source: Reuters

Comments
Loading...