Gold prices edged higher on Monday as the dollar softened ahead of key central bank policy meetings and the U.S.-North Korea summit this week, and as a weekend G-7 summit fanned trade war fears.
Spot gold was up 0.1 percent at $1,299.30 per ounce at 0339 GMT. U.S. gold futures for August delivery were 0.1 percent higher at $1,303.40 per ounce.
The dollar index, which measures the greenback against a basket of six major currencies, was down 0.1 percent at 93.495.
“The market opened predictably quiet ahead of the abundance of risk events this week and wholly ignored President Trump going rogue at the G-7,” Stephen Innes, APAC trading head at OANDA said, adding that with geopolitical risk moderating, it will be the FED and ECB that will guide gold’s near-term fate.
U.S. President Donald Trump threw the G-7’s efforts to show a united front into disarray after taking aim at Canadian Prime Minister Justin Trudeau, adding he might double down on import tariffs by hitting the sensitive auto industry.
The U.S. Federal Reserve’s Federal Open Market Committee (FOMC) starts its two-day meeting on Tuesday, where it is anticipated to raise U.S. interest rates. The European Central Bank (ECB) and Bank of Japan’s policy meetings are also due this week.
Markets are also keeping a close eye on the historic summit between Trump and North Korean leader Kim Jong Un in Singapore on Tuesday.
Gold is trading in a very tight range and people are waiting for the next move, a Hong Kong-based trader said.
“We have the FOMC coming up and the Trump meeting with Kim Jong Un, so the markets are just watching what’s going on. If there’s a better risk aversion money will fly into gold.”
Holdings of SPDR Gold Trust, the world’s largest gold-backed exchange-traded fund, fell 0.46 percent to 828.76 tonnes on Friday, the lowest since February 22.
Speculators cut their net long position in COMEX gold by 3,169 contracts to 58,066 contracts in the week to June 5, U.S. Commodity Futures Trading Commission (CFTC) data showed on Friday.
Silver gained 0.9 percent at $16.89 an ounce, after hitting a seven-week high of $16.93 earlier in the session. The metal was up 2.3 percent last week, also its biggest weekly percentage rise in seven-weeks.
Palladium was nearly unchanged at $1,014.15 an ounce, while platinum rose 0.8 percent at $908.70 an ounce.